EXHIBIT 10.1
AMENDED AND RESTATED STOCK EXCHANGE AGREEMENT
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AMENDED AND RESTATED STOCK EXCHANGE AGREEMENT (this
"Agreement") dated as of March 31, 2003, by and among WinWin, Inc., a Nevada
corporation ("WinWin"), WinWin Acquisition Corp., a Nevada corporation
("Acquiror"), WinWin Gaming, Inc., f/k/a Junum Incorporated, a Delaware
corporation ("Gaming"), The Xxxxxx Living Trust ("Xxxxxx"), The Falcor Trust
("Falcor") and the other WinWin Stockholders signatory hereto (together with
Xxxxxx and Falcor, the "WinWin Stockholders" or the "Exchanging Stockholders").
W I T N E S S E T H :
WHEREAS, the board of directors and majority stockholders of
Acquirer have determined that it is in the best interest of Acquirer and its
stockholders to acquire, through an exchange of stock in accordance with the
terms hereof, 100% of the outstanding common stock of WinWin (the "WinWin
Stock");
WHEREAS, the WinWin Stockholders have determined that it is in
their best interest to exchange each share of WinWin Stock held by them for 1.0
shares of common stock of Gaming which is held by Acquiror;
WHEREAS, the Parties hereto intend that the exchange of stock
of WinWin for stock of Gaming shall be treated as a transfer described in
Section 351(a) and Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as
amended (the "Code"); and
WHEREAS, it is the intention of the parties hereto that,
immediately following consummation of the exchange of the WinWin Shares pursuant
to this Agreement, Acquirer shall own all of the outstanding shares of capital
stock of WinWin, and the WinWin Stockholders, in combination with any other
persons transferring property to Acquirer in exchange for common stock of
Acquirer pursuant to transactions contemplated by this Agreement, shall own,
immediately after the completion of such transactions, stock constituting in
excess of eighty percent of Gaming, the parent of Acquiror, within the meaning
of Section 368(c) of the Code..
NOW, THEREFORE, in consideration of the foregoing and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
EXCHANGE OF WINWIN STOCK
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Section 1.1 EXCHANGE OF STOCK. Subject to the terms and
conditions herein stated, each WinWin Stockholder hereby agrees to assign,
transfer and deliver to Acquirer on the Closing Date, all shares of common stock
of WinWin owned by such WinWin Stockholder, and Acquirer agrees to acquire from
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such WinWin Stockholders on the Closing Date, all of such shares of WinWin
common stock. In addition, Acquirer agrees to acquire any outstanding warrants
or other securities convertible into common stock of Winwin in exchange for
warrants of Gaming on the exact same terms and conditions as the acquired
Warrants and/or convertible securities. The certificates representing the WinWin
Stock shall be duly endorsed in blank, or accompanied by stock powers duly
executed in blank, by the respective the Exchanging Stockholder thereof.
Section 1.2 EXCHANGE PRICE. On the Closing Date, Acquirer
shall deliver to the Exchanging Stockholders, an aggregate of Eighteen Million
Five Hundred Twenty-two Thousand Eight Hundred Fifty Three (18,522,853) shares
(the "Exchange Price") of the common stock of Gaming (the "Acquirer Common
Stock"), and a Secured Debenture in the amount of $5,000,000, the form of which
is attached hereto as Exhibit A. The Exchange Price shall be distributed to all
stockholders of WinWin. Gaming shall issue to the holders of securities
convertible into, or exercisable for, shares of common stock of WinWin (the
"WinWin Convertible Securities"), new securities in the name of Gaming upon the
same terms as the WinWin Convertible Securities.
Section 1.3 SECURED DEBENTURE. The Secured Debenture shall be
secured by a first priority perfected security interest against 100% of the
issued and outstanding capital stock of WinWin, Inc. The Secured Debenture shall
be reduced to zero in the event WinWin earnes Net Income after taxes of at least
$10,000,000 in any one year prior to the maturity of the Secured Debenture. It
shall be an event of default, which shall permit the Exchanging Shareholders to
immediately recover the capital stock of WinWin, in the event any liability of
Junum Incorporated, or any of its current or former subsidiaries, remains
unpaid, and any creditor seeks to obtain an attachment of the capital stock of
Acquirer or WinWin, Inc., or any of their assets, or if any bankruptcy
proceeding (whether voluntary or involuntary) is commenced against Gaming.
Acquirer shall duly file appropriate UCC-1 Financing Statements to perfect such
security interest. The Exchanging Shareholders hereby appoint Xxxxxxx Xxxxxx and
Xxxxxxxx Xxxxx as their attorney-in-fact to receive the Secured Debenture, and
to distribute the proceeds of such Secured Debenture, if any, to the Exchanging
Shareholders prorate in accordance with their current ownership of WinWin, Inc.
Such attorneys-in-fact shall have the right to exercise all rights and
privileges of the sole and absolute holders of the Secured Debenture, including
agreeing to modifications, amendments, waivers, or any other concession which
such attorneys-in-fact shall determine in good faith to be in the best interest
of the Exchanging Shareholders currently holding a majority of the WinWin, Inc.
common stock.
Section 1.4 CLOSING. The closing of the transactions referred
to in Section 1.1 hereof (the "Closing") shall take place at 10:00 a.m. on March
31, 2003, or at such other time as the parties may agree upon.
Such time and date are herein referred to as the "Closing Date."
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ARTICLE II
REPRESENTATIONS OF WINWIN AND EXCHANGING STOCKHOLDERS
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WinWin hereby represents and warrants, and, with respect to
Section 2.1 and 2.2 only, each Exchanging Stockholder, severally but not
jointly, represents and warrants, as follows:
Section 2.1 OWNERSHIP OF WINWIN STOCK. Each Exchanging
Stockholder is the lawful owner of the number of shares of WinWin Stock being
sold by such shareholder, which shall be free and clear of all liens,
encumbrances, security interests, restrictions and claims of every kind and
character ("Encumbrances"), other than the Encumbrance, if any, that may arise
by the execution by the Exchanging Stockholders of this Agreement. The WinWin
Stock constitutes all of the issued and outstanding shares of capital stock of
WinWin. The delivery to Acquirer of the WinWin Stock pursuant to the provisions
of this Agreement will transfer to Acquirer valid title thereto, free and clear
of any and all Encumbrances.
Section 2.2 AUTHORIZATION AND VALIDITY OF AGREEMENT. The
Exchanging Stockholders have full power and authority (corporate or otherwise)
to execute and deliver this Agreement, to perform their obligations hereunder
and to consummate the transactions contemplated hereby. This Agreement has been
duly executed and delivered by the Exchanging Stockholders and, assuming the due
execution of this Agreement by Acquirer, is a valid and binding obligation of
each Exchanging Stockholder, enforceable against each Exchanging Stockholder in
accordance with its terms, except to the extent that its enforceability may be
subject to applicable bankruptcy, insolvency, reorganization and similar laws
affecting the enforcement of creditors' rights generally and to general
equitable principles.
Section 2.3 CONSENTS AND APPROVALS; NO VIOLATIONS. The
execution and delivery of this Agreement by WinWin and the Exchanging
Stockholders and the consummation by WinWin and the Exchanging Stockholders of
the exchange of the WinWin Stock as contemplated herein and the other
transactions contemplated hereby (the "Exchange") (a) will not violate the
provisions of the Articles of Incorporation or Bylaws of WinWin, (b) will not
violate any statute, rule, regulation, order or decree of any public body or
authority by which any the Exchanging Stockholder or WinWin is bound or by which
any of their respective properties or assets are bound, (c) will not require any
filing with, or permit, consent or approval of, or the giving of any notice to,
any United States governmental or regulatory body, agency or authority on or
prior to the Closing Date, and (d) will not result in a violation or breach of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default (or give rise to any right of termination, cancellation, payment or
acceleration) under, or result in the creation of any Encumbrance upon any of
the properties or assets of any the Exchanging Stockholder or WinWin under, any
of the terms, conditions or provisions of any note, bond, mortgage, indenture,
license, franchise, permit, agreement, lease, franchise agreement or any other
instrument or obligation to which any the Exchanging Stockholder or WinWin is a
party, or by which they or any of their respective properties or assets may be
bound.
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Section 2.4 EXISTENCE AND GOOD STANDING. WinWin is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Nevada and has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as now being
conducted. WinWin is duly qualified or licensed as a foreign corporation to
conduct its business, and is in good standing in each jurisdiction in which the
character or location of the property owned, leased or operated by it or the
nature of the business conducted by it makes such qualification necessary,
except where the failure to be so duly qualified or licensed would not have a
Material Adverse Effect. The term "Material Adverse Effect" means any
circumstance, change in or effect on WinWin that is materially adverse to the
business, operations, properties, financial condition or results of operations
of WinWin and its Subsidiaries, taken as a whole.
Section 2.5 CAPITAL STOCK. WinWin has an authorized
capitalization consisting of 50,000,000 shares of common stock, par value $.0001
per share, of which 18,522,853 shares are issued and outstanding. No other
capital stock is issued or outstanding. All such outstanding shares have been
duly authorized and validly issued and are fully paid and nonassessable. Except
as set forth on Schedule 2.5, there are no outstanding subscriptions, options,
warrants, rights, calls, commitments, conversion rights, rights of exchange,
plans or other agreements providing for the purchase, issuance or sale of any
shares of the capital stock of WinWin.
Section 2.6 LITIGATION. There are no (i) actions, suits or
legal, equitable, arbitrative or administrative proceedings pending, or to the
Knowledge of WinWin, threatened against WinWin or (ii) judgments, injunctions,
writs, rulings or orders by any Governmental Person against WinWin.
Section 2.7 TAXES. WinWin has filed all Federal, state and
foreign income tax returns and all other material tax returns that are required
to be filed by it and has paid all taxes due pursuant to such returns or
pursuant to any assessment received by it in writing and all other related
penalties and charges other than those being contested in good faith and by
appropriate proceedings. The charges, accruals and reserves on the other
governmental charges are, in the opinion of WinWin, adequate. WinWin has not
given or been requested to give a waiver of the statute of limitations relating
to the payment of Federal or other taxes.
Section 2.6 BROKER'S OR FINDER'S FEES. No agent, broker, firm
or other Person acting on behalf of the Exchanging Stockholders or WinWin is, or
will be, entitled to any commission or broker's or finder's fees from any of the
parties hereto, or from any Person controlling, controlled by or under common
control with any of the parties hereto, in connection with any of the
transactions contemplated herein.
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ARTICLE III
REPRESENTATIONS OF ACQUIRER
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Acquirer represents and warrants as follows:
Section 3.1 ACQUIRER STOCK. Upon the execution and delivery of
this Agreement, and the issuance of the shares of Acquirer Common Stock which
constitute the Exchange Price, all such shares shall be duly authorized, validly
issued, fully paid and nonassessable.
Section 2.2 AUTHORIZATION AND VALIDITY OF AGREEMENT. Each of
Gaming and Acquirer has full power and authority (corporate or otherwise) to
execute and deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby. This Agreement has been duly
executed and delivered by Gaming and Acquirer and, assuming the due execution of
this Agreement by WinWin and the Exchanging Stockholders, is a valid and binding
obligation of Acquirer and Gaming, enforceable against Acquirer and Gaming in
accordance with its terms, except to the extent that its enforceability may be
subject to applicable bankruptcy, insolvency, reorganization and similar laws
affecting the enforcement of creditors' rights generally and to general
equitable principles.
Section 3.3 CONSENTS AND APPROVALS; NO VIOLATIONS. The
execution and delivery of this Agreement by Acquirer and Gaming and the
consummation by Acquirer of the exchange of the WinWin Stock as contemplated
herein and the other transactions contemplated hereby (a) will not violate the
provisions of the Certificate of Incorporation or Bylaws of Acquirer or Gaming,
(b) will not violate any statute, rule, regulation, order or decree of any
public body or authority by which Acquirer is bound or by which any of their
respective properties or assets are bound, (c) will not require any filing with,
or permit, consent or approval of, or the giving of any notice to, any United
States governmental or regulatory body, agency or authority on or prior to the
Closing Date (as defined in Section 1.4), and (d) will not result in a violation
or breach of, conflict with, constitute (with or without due notice or lapse of
time or both) a default (or give rise to any right of termination, cancellation,
payment or acceleration) under, or result in the creation of any Encumbrance
upon any of the properties or assets of the Acquirer under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
franchise, permit, agreement, lease, franchise agreement or any other instrument
or obligation to which Acquirer is a party, or by which they or any of its
properties or assets may be bound.
Section 3.4 EXISTENCE AND GOOD STANDING. Acquirer is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Nevada and has all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as now being
conducted. Acquirer is duly qualified or licensed as a foreign corporation to
conduct its business, and is in good standing in each jurisdiction in which the
character or location of the property owned, leased or operated by it or the
nature of the business conducted by it makes such qualification necessary,
except where the failure to be so duly qualified or licensed would not have a
Material Adverse Effect. The term "Material Adverse Effect" means any
circumstance, change in or effect on Acquirer that is materially adverse to the
business, operations, properties, financial condition or results of operations
of Acquirer, taken as a whole.
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Section 3.5 CAPITAL STOCK. Acquirer has an authorized
capitalization consisting of 100,000 shares of common stock, par value $.001 per
share, of which 1,000 shares are issued and outstanding, and no preferred stock.
Gaming has, or will have on the Closing Date, 18,572,076 shares of common stock
outstanding, and 1,350 shares of Series B Convertible Preferred Stock
outstanding. All such outstanding shares have been duly authorized and validly
issued in accordance with applicable laws, including, without limitation, the
anti-fraud provisions of applicable federal and state securities laws and are
fully paid and nonassessable. There are no outstanding subscriptions, options,
warrants, rights, calls, commitments, conversion rights, rights of exchange,
plans or other agreements providing for the purchase, issuance or sale of any
shares of the capital stock of Acquirer. Gaming has agreed to cause the Series B
Convertible Preferred Stock to be converted into common stock within ten days
following the closing of the transactions set forth herein.
Section 3.6 FINANCIAL STATEMENTS. Acquirer has heretofore
furnished, or will furnish prior to the Closing Date, WinWin with the unaudited
consolidated balance sheet of Gaming as at September 30, 2002 and the related
audited statements of income and cash flows for the periods then ended (the
"Financial Statements"). To the best knowledge of Acquirer and Gaming, the
Financial Statements, including the footnotes thereto, and all financial
statements contained in any SEC Reports (defined in Section 3.7 below) have been
prepared in accordance with generally accepted accounting principles and fairly
and accurately present in all material respects the financial position of Gaming
and the results of its operations and cash flows at such dates and for such
periods. Prior to September 30, 2002, all operations of Gaming were terminated,
and subsequent to September 30, 2002, the remaining asset of Gaming, a
non-performing debt portfolio, was returned to the seller thereof in exchange
for cancellation of outstanding preferred stock of Gaming.
Section 3.7 SECURITIES FILINGS. Since the initial filing of
the registration statement on Form 10 by Gaming, and prior to the execution and
delivery of this Agreement, Gaming has filed various forms, reports, statements
and other documents required to be filed with the Securities and Exchange
Commission (the "SEC") and all state securities regulatory agencies, if any
(collectively, the "SEC Reports"). WinWin and its shareholders have reviewed all
of such filings, and have had the opportunity to conduct due diligence and
question current management of Gaming in connection with such due diligence, and
have satisfied themselves as to the financial condition of Gaming. WinWin and
its shareholders are not relying on any representation, warranty or promise
other than as expressly contained herein, and are relying only on their own due
diligence investigation.
Section 3.8 BROKER'S OR FINDER'S FEES. No agent, broker, firm
or other Person acting on behalf of Acquirer is, or will be, entitled to any
commission or broker's or finder's fees from any of the parties hereto, or from
any Person controlling, controlled by or under common control with any of the
parties hereto, in connection with any of the transactions contemplated herein.
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ARTICLE IV
CERTAIN AGREEMENTS
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Section 4.1 REASONABLE BEST EFFORTS. Each of the parties
hereto agrees to use its reasonable best efforts to take, or cause to be taken,
all action to do or cause to be done, and to assist and cooperate with the other
party hereto in doing, all things necessary, proper or advisable to consummate
and make effective, in the most expeditious manner practicable, the transactions
contemplated by this Agreement, including, but not limited to, (a) the obtaining
of all necessary waivers, consents and approvals from governmental or regulatory
agencies or authorities and the making of all necessary registrations and
filings and the taking of all reasonable steps as may be necessary to obtain any
approval or waiver from, or to avoid any action or proceeding by, any
governmental agency or authority, (b) the obtaining of all necessary consents,
approvals or waivers from stockholders and other third parties and (c) the
defending of any lawsuits or any other legal proceedings, whether judicial or
administrative, challenging this Agreement or the consummation of the
transactions contemplated hereby, including, without limitation, seeking to have
any temporary restraining order entered by any court or administrative authority
vacated or reversed.
Section 4.2 OPTIONS AND WARRANTS. At the Closing, all
unexercised options and warrants to purchase common stock of WinWin set forth on
Schedule 2.5 shall be converted into options and warrants to acquire, for the
same exercise price, the same number of shares of Gaming which the holder of
such options or warrants would have received had such options or warrants been
exercised immediately prior to the Closing
Section 4.3 TAX MATTERS. Each party hereto shall take all
reasonable actions necessary to cause the transfers of WinWin common stock to
Acquirer to qualify as tax-free transfers of property under the provisions of
Section 351(a) of the Code, or any other applicable provisions, to the extent
permitted by law, and with respect to the transfers of WinWin common stock, a
reorganization within the meaning of Section 368(a)(1)(B). Each party agrees
that it will not take any action, either before or after the Closing Date, which
would cause the transfers of such property to Acquirer pursuant to this
Agreement to fail to qualify as transfers described in Section 351(a) of the
Code and/or Section 368(a)(1)(B). The parties hereto agree that they will report
in their respective federal income Tax Returns for the taxable year including
the Closing Date that the transfers of such property did so qualify under
Section 351(a) and Section 368(a)(1)(B) of the Code, and will properly file with
such Tax Returns all information required by Treasury Regulations Sections
1.351-3 and 1.368-3. No party hereto, unless required by law, will take any Tax
reporting position inconsistent with the characterization of the transactions
contemplated by this Agreement as transfers described in Section 351(a) and/or
Section 368(a)(1)(B) of the Code.
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ARTICLE V
CONDITIONS TO ACQUIRER'S OBLIGATIONS
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The acquisition of the WinWin Stock by Acquirer on the Closing
Date is conditioned upon the satisfaction or waiver, at or prior to the
consummation of the Exchange, of the following conditions:
Section 5.1 TRUTH OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of WinWin and the WinWin Stockholders contained
in this Agreement or in any Schedule delivered pursuant hereto shall be true and
correct in all material respects on and as of the Closing Date with the same
effect as though such representations and warranties have been made on and as of
such date (except to the extent that any such representation and warranty is
stated in this Agreement to be made as of a specific date, in which case such
representation and warranty shall be true and correct as of such specified
date).
Section 5.2 PERFORMANCE OF AGREEMENTS. Each and all of the
agreements of WinWin and the WinWin Stockholders to be performed at or prior to
the Closing Date pursuant to the terms hereof shall have been duly performed in
all material respects.
Section 5.3 NO INJUNCTION. No court or other government body
or public authority shall have issued an order which shall then be in effect
restraining or prohibiting the completion of the transactions contemplated
hereby.
Section 5.4 NO LITIGATION. There shall not be any action, suit
or proceeding pending or threatened that seeks to (i) make the consummation of
the transactions contemplated hereby illegal or otherwise restrict or prohibit
consummation thereof or (ii) require the divestiture by Acquirer or any of its
subsidiaries or Affiliates of shares of stock or of any business, assets or
property of any of its subsidiaries or Affiliates, or impose any material
limitation on the ability of any of them to conduct their business or to own or
exercise control of such assets, properties or stock and which, in either case,
in the reasonable, good faith determination of Acquirer has a significant
likelihood of having a material adverse effect on Acquirer.
ARTICLE VI
CONDITIONS TO WINWIN AND THE WINWIN SHAREHOLDERS' OBLIGATIONS
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The exchange of the WinWin Stock by the stockholders of WinWin
on the Closing Date is conditioned upon satisfaction or waiver, at or prior to
the consummation of the Exchange of the following conditions:
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Section 6.1 TRUTH OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Acquirer contained in this Agreement shall be
true and correct in all material respects on and as of the Closing Date with the
same effect as though such representations and warranties had been made on and
as of such date.
Section 6.2 PERFORMANCE OF AGREEMENTS. Each and all of the
agreements of Acquirer and Gaming to be performed at or prior to the Closing
Date pursuant to the terms hereof shall have been duly performed in all material
respects.
Section 6.3 NO INJUNCTION. There shall not be any action, suit
or proceeding pending or threatened that seeks to (i) make the consummation of
the transactions contemplated hereby illegal or otherwise restrict or prohibit
consummation thereof or (ii) impose any material limitation on the ability of
(a) Acquirer or WinWin to conduct their business or (b) Acquirer, WinWin or the
WinWin Stockholders to own or exercise control of their assets, properties or
stock and which, in either case, in the reasonable, good faith determination of
the WinWin Stockholders has a significant likelihood of having a material
adverse effect on Acquirer, WinWin, or the WinWin Stockholders.
Section 6.4 TAX FREE TRANSACTIONS. The WinWin Stockholders
shall be satisfied, in their sole discretion, that the transfer of WinWin Common
Stock to Acquirer contemplated by this Agreement shall qualify for
non-recognition of gain pursuant to Section 351(a) or Section 368(a)(1)(B) of
the Code so that such transfer in exchange for Acquirer common stock shall not
result in any tax liability to the WinWin Stockholders.
Section 6.5 CONVERSION OF SERIES B PREFERRED STOCK. The WinWin
Stockholders shall be satisfied, in their sole discretion, that the holders of
the Series B Preferred Stock of the Company shall have agreed to convert their
preferred stock as soon as practical following the Closing Date, but in any
event within ten days following the Closing Date.
ARTICLE VII
SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION
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Section 7.1 SURVIVAL OF REPRESENTATIONS. The representations
and warranties set forth in this Agreement shall survive for three years after
the Closing Date.
Section 7.2 INDEMNITIES. (a) Each Exchanging Stockholder,
severally but not jointly, hereby agrees to indemnify and hold harmless Acquirer
from and against any and all damages, claims, losses or expenses (including
reasonable attorneys' fees and expenses) ("Damages") actually suffered or paid
by Acquirer or WinWin as a result of the breach of any representation or
warranty made by such Exchanging Stockholder in this Agreement. To the extent
that the Exchanging Stockholder's undertakings set forth in this Section 7.2(a)
may be unenforceable, the Exchanging Stockholders shall contribute the maximum
amount that they are permitted to contribute under applicable law to the payment
and satisfaction of all Damages incurred by the parties entitled to
indemnification hereunder. WinWin hereby agrees to indemnify and hold harmless
Acquirer and the WinWin Stockholders from and against any and all damages,
claims, losses or expenses (including reasonable attorneys' fees and expenses)
("Damages") actually suffered or paid by Acquirer or the WinWin Stockholders as
a result of the breach of any representation or warranty made by WinWin in this
Agreement.
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(b) Acquirer and WinWin hereby agree to indemnify and hold
harmless the Exchanging Stockholders against Damages actually suffered or paid
by the Exchanging Stockholders as a result of the breach of any representation
or warranty made by the Acquirer in this Agreement. To the extent that the
Acquirer's undertakings set forth in this Section 7.2(b) may be unenforceable,
the Acquirer and WinWin shall contribute the maximum amount that they are
permitted to contribute under applicable law to the payment and satisfaction of
all Damages incurred by the parties entitled to indemnification hereunder.
(c) Any party seeking indemnification under this Article VII
(an "Indemnified Party") shall give each party from whom indemnification is
being sought (each, an "Indemnifying Party") notice of any matter for which such
Indemnified Party is seeking indemnification, stating the amount of the Damages,
if known, and method of computation thereof, and containing a reference to the
provisions of this Agreement in respect of which such right of indemnification
is claimed or arises. The obligations of an Indemnifying Party under this
Article VII with respect to Damages arising from any claims of any third party
which are subject to the indemnification provided for in this Article VII
(collectively, "Third Party Claims") shall be governed by and contingent upon
the following additional terms and conditions: if an Indemnified Party shall
receive, after the Closing Date, initial notice of any Third Party Claim, the
Indemnified Party shall give the Indemnifying Party notice of such Third Party
Claim within such time frame as is necessary to allow for a timely response and
in any event within 30 days of the receipt by the Indemnified Party of such
notice; PROVIDED, HOWEVER, that the failure to provide such timely notice shall
not release the Indemnifying Party from any of its obligations under this
Article VII except to the extent the Indemnifying Party is materially prejudiced
by such failure. The Indemnifying Party shall be entitled to assume and control
the defense of such Third Party Claim at its expense and through counsel of its
choice if it gives notice of its intention to do so to the Indemnified Party
within 30 days of the receipt of such notice from the Indemnified Party;
PROVIDED, HOWEVER, that if there exists or is reasonably likely to exist a
conflict of interest that would make it inappropriate in the reasonable judgment
of the Indemnified Party (upon advice of counsel) for the same counsel to
represent both the Indemnified Party and the Indemnifying Party, then the
Indemnified Party shall be entitled to retain its own counsel, at the expense of
the Indemnifying Party, provided that the Indemnified Party and such counsel
shall contest such Third Party Claims in good faith. In the event the
Indemnifying Party exercises the right to undertake any such defense against any
such Third Party Claim as provided above, the Indemnified Party shall cooperate
with the Indemnifying Party in such defense and make available to the
Indemnifying Party, at the Indemnifying Party's expense, all witnesses,
pertinent records, materials and information in the Indemnified Party's
possession or under the Indemnified Party's control relating thereto as is
reasonably required by the Indemnifying Party. Similarly, in the event the
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Indemnified Party is, directly or indirectly, conducting the defense against any
such Third Party Claim, the Indemnifying Party shall cooperate with the
Indemnified Party in such defense and make available to the Indemnified Party,
at the Indemnifying Party's expense, all such witnesses, records, materials and
information in the Indemnifying Party's possession or under the Indemnifying
Party's control relating thereto as is reasonably required by the Indemnified
Party. The Indemnifying Party shall not, without the written consent of the
Indemnified Party, (i) settle or compromise any Third Party Claim or consent to
the entry of any judgment which does not include as an unconditional term
thereof the delivery by the claimant or plaintiff to the Indemnified Party of a
written release from all liability in respect of such Third Party Claim or (ii)
settle or compromise any Third Party Claim in any manner that may adversely
affect the Indemnified Party. No Third Party Claim which is being defended in
good faith by the Indemnifying Party or which is being defended by the
Indemnified Party as provided above in this Section 7.2(c) shall be settled by
the Indemnified Party without the written consent of the Indemnifying Party.
ARTICLE VIII
MISCELLANEOUS
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Section 8.1 EXPENSES. Except as otherwise provided in this
Agreement, each party to this Agreement will bear its respective fees and
expenses incurred in connection with the preparation, negotiation, execution and
performance of this Agreement and the transactions contemplated herein. If this
Agreement is terminated, the obligation of each party to pay its own fees and
expenses will be subject to any rights of such party arising from a breach of
this Agreement by another party.
Section 8.2 WAIVER; REMEDIES CUMULATIVE. The rights and
remedies of the parties to this Agreement are cumulative and not alternative.
Neither any failure nor any delay by any party in exercising any right, power or
privilege under this Agreement or any of the documents referred to in this
Agreement will operate as a waiver of such right, power or privilege, and no
single or partial exercise of any such right, power or privilege will preclude
any other or further exercise of such right, power or privilege or the exercise
of any other right, power or privilege. To the maximum extent permitted by
applicable law, (a) no claim or right arising out of this Agreement or any of
the documents referred to in this Agreement can be discharged by one party, in
whole or in part, by a waiver or renunciation of the claim or right unless in
writing signed by the other party; (b) no waiver that may be given by a party
will be applicable except in the specific instance for which it is given; and
(c) no notice to or demand on one party will be deemed to be a waiver of any
obligation of that party or of the right of the party giving such notice or
demand to take further action without notice or demand as provided in this
Agreement or the documents referred to in this Agreement.
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Section 8.3 ENTIRE AGREEMENT AND MODIFICATION. This Agreement
supersedes all prior agreements between the parties hereto, whether written or
oral, with respect to its subject matter, and constitutes (along with the
Exhibits and other documents delivered pursuant to this Agreement) a complete
and exclusive statement of the terms of the agreement between the parties with
respect to its subject matter. This Agreement may not be amended, supplemented,
or otherwise modified except by a written agreement executed by the party to be
charged with the amendment.
Section 8.4 ASSIGNMENTS, SUCCESSORS AND NO THIRD-PARTY RIGHTS.
No party may assign any of its rights or delegate any of its obligations under
this Agreement without the prior written consent of the other parties. Subject
to the preceding sentence, this Agreement will apply to, be binding in all
respects upon and inure to the benefit of the successors and permitted assigns
of the parties. Nothing expressed or referred to in this Agreement will be
construed to give any Person other than the parties to this Agreement any legal
or equitable right, remedy or claim under or with respect to this Agreement or
any provision of this Agreement, except such rights as shall inure to a
successor or permitted assignee pursuant to this Section.
Section 8.5 SEVERABILITY. If any provision of this Agreement
is held invalid or unenforceable by any court of competent jurisdiction, the
other provisions of this Agreement will remain in full force and effect. Any
provision of this Agreement held invalid or unenforceable only in part or degree
will remain in full force and effect to the extent not held invalid or
unenforceable.
Section 8.6 CONSTRUCTION. The headings of Articles and
Sections in this Agreement are provided for convenience only and will not affect
its construction or interpretation. All references to "Articles" and "Sections"
refer to the corresponding Articles and Sections of this Agreement.
Section 8.7 TIME OF ESSENCE. With regard to all dates and time
periods set forth or referred to in this Agreement, time is of the essence.
Section 8.8 NOTICES. All notices, consents, waivers and other
communications required or permitted by this Agreement shall be in writing and
shall be deemed given to a party when (a) delivered to the appropriate address
by hand or by nationally recognized overnight courier service (costs prepaid);
(b) sent by facsimile or e-mail with confirmation of transmission by the
transmitting equipment, so long as such facsimile or e-mail is followed by a
copy sent by mail; or (c) received or rejected by the addressee, if sent by
certified mail, return receipt requested, in each case to the following
addresses, facsimile numbers or e-mail addresses and marked to the attention of
the person (by name or title) designated below (or to such other address,
facsimile number, e-mail address or person as a party may designate by notice to
the other parties):
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if to Acquirer, to it at:
WINWIN, INC.
0000 Xxxx Xxxxxx Xxx, Xxxxx 000-X00
Xxx Xxxxx, Xxxxxx 00000
U.S.A
Attn: President
and if to WinWin or the Exchanging Stockholders, to it, care
of WinWin, Inc., at:
WINWIN, INC.
0000 Xxxx Xxxxxx Xxx, Xxxxx 000-X00
Xxx Xxxxx, Xxxxxx 00000
U.S.A
Attn: President
Section 8.9 GOVERNING LAW; CONSENT TO JURISDICTION. (a) The
interpretation and construction of this Agreement, and all matters relating
hereto, shall be governed by the laws of the State of California applicable to
contracts made and to be performed entirely within the State of California.
(b) Any proceeding, action, litigation or claim (a "Proceeding")
arising out of or relating to this Agreement or any of the transactions
contemplated herein may be brought in the courts of the State of California,
County of Los Angeles, or, if it has or can acquire jurisdiction, in the United
States District Court for the Central District of California, and each of the
parties irrevocably submits to the exclusive jurisdiction of each such court in
any such Proceeding, waives any objection it may now or hereafter have to venue
or to convenience of forum, agrees that all claims in respect of the Proceeding
shall be heard and determined only in any such court and agrees not to bring any
Proceeding arising out of or relating to this Agreement or any of the
transactions contemplated herein in any other court. The parties agree that
either or both of them may file a copy of this paragraph with any court as
written evidence of the knowing, voluntary and bargained agreement between the
parties irrevocably to waive any objections to venue or to convenience of forum.
Each party hereto hereby consents to process being served in any such action or
proceeding by the mailing of a copy thereof to the address set forth opposite
its name below and agrees that such service upon receipt shall constitute good
and sufficient service of process or notice thereof. Nothing in this paragraph
shall affect or eliminate any right to serve process in any other manner
permitted by law.
Section 8.10 WAIVER OF JURY TRIAL. THE PARTIES HEREBY WAIVE
ANY RIGHT TO TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS, WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE
PARTIES AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT
AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG
THE PARTIES IRREVOCABLY TO WAIVE TRIAL BY JURY AND THAT ANY PROCEEDING
WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY OF THE CONTEMPLATED
TRANSACTIONS SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A
JUDGE SITTING WITHOUT A JURY.
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Section 8.11 EXECUTION OF AGREEMENT. This Agreement may be
executed in one or more counterparts, each of which will be deemed to be an
original copy of this Agreement and all of which, when taken together, will be
deemed to constitute one and the same agreement. The exchange of copies of this
Agreement and of signature pages by facsimile transmission shall constitute
effective execution and delivery of this Agreement as to the parties and may be
used in lieu of the original Agreement for all purposes. Signatures of the
parties transmitted by facsimile shall be deemed to be their original signatures
for all purposes.
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IN WITNESS WHEREOF, each of the parties have caused this
Agreement to be executed by their respective officers who have been duly
authorized, all as of the day and year first above written.
WinWin, Inc.,
a Nevada corporation
By: /s/ Xxxxxxxx Xxxxx
-----------------------------
Name: Xxxxxxxx Xxxxx
Title: President
By: /s/ Xxxxxxx Xxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxx
Title: Secretary and Chairman
WinWin Acquisition Corp.,
a Nevada corporation
By: /s/ Xxxxxxxx Xxxxx
-----------------------------
Name: Xxxxxxxx Xxxxx
Title: President
By: /s/ Xxxxxxx Xxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxx
Title: Secretary and Chairman
WinWin Gaming, Inc.,
a Delaware corporation
By: /s/ Xxxxxxxx Xxxxx
-----------------------------
Name: Xxxxxxxx Xxxxx
Title: President
By: /s/ Xxxxxxx Xxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxx
Title: Secretary and Chairman
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