EXHIBIT 2.1
SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT (the "Agreement"), dated as of June 14,
2001, is by and among ECOS Group, Inc., a Florida corporation (the "Company"),
Third Millennium Telecommunications, Inc., a New Jersey corporation ("TMTI"),
each of the shareholders of TMTI (the "Sellers"), and the individuals listed on
Schedule I attached hereto (collectively referred to herein as "EE&G
Management"). The Company, TMTI, the Sellers and EE&G Management are
collectively referred to herein as the "Parties."
W I T N E S S E T H:
WHEREAS, the Sellers collectively own 100% of the shares of issued and
outstanding common stock of TMTI, par value $.001 per share ("TMTI Common
Stock"), in the amounts set forth opposite their respective names on Schedule II
to this Agreement; and
WHEREAS, the Company desires to acquire from the Sellers, and the
Sellers desire to sell to the Company, 100% of the outstanding TMTI Common Stock
in exchange for the issuance and delivery by the Company of an aggregate of
6,875,000 shares of the Company's common stock, par value $.012 per share (the
"Common Stock"), after giving effect to the Reverse Split (as defined herein)
(the "Share Exchange");
WHEREAS, upon the achievement of certain financial thresholds by TMTI
after Closing, an aggregate of 35,000,000 additional shares of the Common Stock
will be delivered to the Sellers on the terms and conditions set forth below;
WHEREAS, simultaneously with the closing of the Share Exchange, the
Company will transfer (i) all of the outstanding shares of its wholly-owned
subsidiary, Xxxxx Environmental and Geological Science and Management, Inc.
("EE&G") to EE&G Management and (ii) all of the Company's asset and liabilities
to EE&G, in exchange for the cancellation of certain shares of Common Stock and
the termination of options to purchase shares of Common Stock, on the terms and
conditions set forth below;
WHEREAS, the Board of Directors and shareholders of each of TMTI and
the Company have determined that the transactions contemplated by this Agreement
(the "Transactions") are in the best interests of their respective companies and
their shareholders and accordingly have agreed to effect the Share Exchange and
the transfer of EE&G provided for herein upon the terms and subject to the
conditions set forth herein; and
WHEREAS, it is the intention of the parties to this Agreement that, for
federal income tax purposes, the Share Exchange provided for herein shall
qualify as a "reorganization" within the meaning of Section 368 of the Internal
Revenue Code of 1986, as amended (the "Code").
NOW, THEREFORE, in consideration of the premises and of the
representations, warranties, covenants and agreements set forth herein, the
parties hereto hereby agree as follows:
EXCHANGE OF SHARES
EXCHANGE OF SHARES. Subject to the terms and conditions of this
Agreement, on the Closing Date (as hereinafter defined):
the Company will issue and deliver to the Sellers an aggregate
of 6,875,000 shares of Common Stock (on a post-Reverse Split basis (as defined
below)), by delivering to each of the Sellers the number of shares of Common
Stock set forth opposite such Seller's name on Schedule II hereto (the "Company
Shares"); and
Exhibit 2.1 1
the Sellers will transfer and deliver to the Company all of
the issued and outstanding shares of TMTI Common Stock with each Seller
transferring such number of shares as is set forth opposite such Seller's name
on Schedule II hereto, together with an appropriately executed stock power
endorsed in favor of the Company.
TIME AND PLACE OF CLOSING. The closing of the transactions contemplated
hereby (the "Closing") shall take place at the law offices of Akerman,
Senterfitt & Xxxxxx, P.A. at Xxx Xxxxxxxxx Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxx,
Xxxxxxx 00000, within five (5) days following satisfaction (or waiver, as the
case may be) of all conditions precedent to Closing set forth in Article XIII
below at 10:00 A.M., Miami time, or at such other time and place as the Company
and the Sellers may agree (the "Closing Date").
SPLIT-OFF OF COMPANY SUBSIDIARY
SPLIT-OFF OF SUBSIDIARY. At Closing, the Company will transfer (i) all
the outstanding and issued shares of common stock, par value $.001 per share, of
EE&G (the "EE&G Common Stock") to the members of EE&G Management in the
percentages set forth on Schedule I, and (ii) all of the assets of the Company
(the "ECOS Assets") to EE&G. In consideration for the transactions set forth in
the previous sentence, EE&G Management agrees to (i) deliver to the Company for
cancellation or termination (A) 6,259,385 shares of Common Stock (on a
pre-Reverse Split basis) and (B) options to purchase 6,009,385 shares of Common
Stock (on a pre-Reverse Split basis); and (ii) cause all of the liabilities of
the Company either known or unknown incurred up to the date of Closing (the
"ECOS Liabilities") to be assumed by EE&G. The ECOS Assets and ECOS Liabilities
are more specifically set forth on Item 2.1 of the disclosure schedule of even
date herewith which either (i) accompanies this Agreement or (ii) shall be
delivered within five (5) business days of the date hereof, and is incorporated
herein by reference (the "Disclosure Schedule").
STOCK SPLIT
REVERSE STOCK SPLIT. Prior to Closing, the Company agrees to take all
corporate action necessary to effect a 1 for 20 reverse stock split immediately
prior to Closing with respect to its issued and outstanding Common Stock (the
"Reverse Split"). The number of authorized shares of the Common Stock shall
remain at 75,000,000 upon completion of the Reverse Split. Prior to Closing, the
Company shall have made all necessary filings with, secured all necessary
consents from and delivered all notices to, the appropriate regulatory agencies
and the Company shareholders with respect to the Reverse Split. Immediately
after consummation of the transactions contemplated in Article I and Article II
herein and the Reverse Split, the Company will have 8,519,663 shares of Common
Stock issued and outstanding. Of this amount, TMTI shareholders will own
6,875,000 shares of Common Stock immediately after Closing and the shareholders
of the Company who owned Common Stock prior to Closing will own 1,281,999 shares
of Common Stock and have the right to purchase an additional 362,664 shares of
Common Stock upon the exercise of certain warrants and options that were
outstanding prior to Closing.
NAME CHANGE
NAME CHANGE. Prior to Closing, the Company shall take all corporate
action necessary to change the Company's name from ECOS Group, Inc. to Third
Millennium Telecommunications, Inc. (or such other name as requested in writing
by the Sellers), effective as of the Closing Date.
Exhibit 2.1 2
CHANGE OF CORPORATE OFFICERS AND DIRECTORS
APPOINTMENTS AND RESIGNATIONS. (a) Prior to Closing, the Company shall
take such actions to appoint the following persons to become officers and
directors of the Company, whose positions shall become effective at Closing:
Xxxxxx Xxxxxxx
Xxxxxxx Xxxxxx
RESIGNATIONS. (a) Prior to Closing, the Company shall take such actions
to accept the resignations of the following persons as officers and directors of
the Company, with such resignations becoming effective at Closing:
Xxxxxxx Xxxxx
Xxxxxxx Xxxx
Xxxx Eplan
Xxx Xxxxxxx
Xxxxxx Xxxxxxxx
Xxxx de la Xxxx
Xxxxxxx Xxxxxxxx
INFORMATION STATEMENT. The Parties understand that the transactions
contemplated by this Agreement may not be consummated until at least twenty (20)
calendar days following filing by the Company of information required under Rule
14-f and 14-c of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") with the Securities and Exchange Commission (the "SEC") and mailing of
such information to all of the Company's shareholders. The Company agrees to
make such filing after the execution of the Agreement. TMTI and the Sellers
agree to cooperate with the Company and provide the Company with such
information as may be necessary to complete such filing. The Company further
represents that such filing will be accurate and complete in all material
respects.
PERFORMANCE EARN-OUT
PERFORMANCE EARN-OUT. At the Closing, the Company shall issue to the
Sellers a total of 35,000,000 shares of Common Stock (on post-Reverse Split
basis) (the "Held Back Shares") in the names of the Sellers in such amounts as
are set forth on Schedule II. The Held Back Shares will be held by the Company
in escrow until TMTI achieves the Performance Threshold (as defined below). At
such time as TMTI has achieved at least $3,000,000 in revenues and at least
$150,000 in net pre-tax income over a trailing three-month period beginning
after the Closing Date (the "Performance Threshold"), the Company shall deliver
the Held Back Shares to the Sellers. The determination of whether the
Performance Threshold has been achieved shall be determined in accordance with
generally accepted accounting principles, applied on a basis consistent
throughout all applicable periods, shall be reviewed and ratified by the
Company's independent accountants, and shall be certified in writing by the
Company's Chief Executive Officer. If the Performance Threshold is not achieved
within three (3) years after the Closing Date, the Held Back Shares will be
cancelled and shall not be delivered to the Sellers. Until the Performance
Threshold is achieved, all Held Back Shares shall be deemed to be owned by the
Company and the Company shall be entitled to vote the Held Back Shares. All cash
payable as a result of any cash dividend with respect to the Held Back Shares
shall be paid to the Company. The Company agrees to abstain from voting the Held
Back Shares with respect to any matter that is presented for a vote to the
holders of the Common Stock.
Exhibit 2.1 3
REPRESENTATIONS OF EE&G MANAGEMENT
Each member of EE&G Management represents and warrants to the Company
that as of the date of this Agreement and as of Closing:
POWER AND AUTHORITY. Each member of EE&G Management has the requisite
competence and authority to execute and deliver this Agreement and to perform
his respective obligations hereunder.
ENFORCEABILITY. This Agreement has been duly executed and delivered by
each member of EE&G Management and constitutes the legal, valid and binding
obligation of each of them, enforceable against each of them in accordance with
its terms, except as may be affected by applicable bankruptcy, insolvency,
reorganization, moratoria or similar laws affecting the enforcement of
creditors' rights generally and subject to the qualification that the
availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefor may be brought.
COMMON STOCK AND OPTIONS. Each member of EE&G Management is the sole
record and beneficial owner of all of the Common Stock set forth following his
name on Schedule I, and owns the Common Stock free and clear of all Liens,
restrictions and claims of any kind. All of the shares of Common Stock held by
each member of EE&G Management (i) have been duly authorized and validly issued
and is fully paid, (ii) were issued in compliance with all applicable state and
federal securities laws, (iii) were not issued in violation of any preemptive
rights or rights of first refusal and (iv) were issued for not less than fair
market value in exchange for lawful consideration. There are no proxies, voting
rights or other agreements or understandings with respect to the voting or
transfer of the Common Stock. None of the options to purchase Common Stock
previously granted to members of EE&G Management and set forth on Schedule I
have been assigned or otherwise transferred.
BROKERS AND CONSULTANTS. All negotiations relative to this Agreement
and the transactions contemplated hereby have been carried out by EE&G
Management directly with the Company without the intervention of any Person on
behalf of EE&G Management in such a manner as to give rise to any valid claim by
any Person against EE&G Management for a finder's fee, brokerage commission or
similar payment.
REPRESENTATIONS AND WARRANTIES OF
THE COMPANY AND EE&G MANAGEMENT
The Company and each member of EE&G Management represent and warrant to
each of the Sellers that as of the date of this Agreement and as of the Closing:
DUE ORGANIZATION AND QUALIFICATION; SUBSIDIARIES; DUE AUTHORIZATION.
The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of its jurisdiction of formation,
with full corporate power and authority to own, lease and operate its business
and properties and to carry on its business in the places and in the manner as
presently conducted or proposed to be conducted. The Company is in good standing
as a foreign corporation in each jurisdiction in which the properties owned,
leased or operated, or the business conducted, by it requires such qualification
except for any such failure, which when taken together with all other such
failures, is not likely to have a Material Adverse Effect (as defined herein) on
the business of the Company and its subsidiaries taken as a whole.
Except for EE&G, the Company does not own, directly or
indirectly, any capital stock, equity or interest in any corporation, firm,
partnership, joint venture or other entity.
The Company has all requisite corporate power and authority to
execute and deliver this Agreement, and to consummate the Transactions. The
Company has taken all corporate action necessary for the execution and delivery
of this Agreement and the consummation of the Transactions, and this Agreement
constitutes the valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, except as may be affected by
bankruptcy, insolvency, moratoria or other similar laws affecting the
enforcement of creditors' rights generally and subject to the qualification that
the availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefor may be brought.
Exhibit 2.1 4
NO CONFLICTS OR DEFAULTS. The execution and delivery of this Agreement
by the Company and the consummation of the transactions contemplated hereby do
not and shall not (a) contravene the Articles of Incorporation or Bylaws of the
Company or (b) with or without the giving of notice or the passage of time (i)
violate, conflict with, or result in a breach of, or a default or loss of rights
under, any material covenant, agreement, mortgage, indenture, lease, instrument,
permit or license to which the Company is a party or by which the Company is
bound, or any judgment, order or decree, or any law, rule or regulation to which
the Company is subject, (ii) result in the creation of, or give any party the
right to create, any lien, charge, encumbrance or any other right or adverse
interest ("Liens") upon any of the assets of the Company, (iii) terminate or
give any party the right to terminate, amend, abandon or refuse to perform, any
material agreement, arrangement or commitment to which the Company is a party or
by which the Company's assets are bound, or (iv) accelerate or modify, or give
any party the right to accelerate or modify, the time within which, or the terms
under which, the Company is to perform any duties or obligations or receive any
rights or benefits under any material agreement, arrangement or commitment to
which it is a party.
CAPITALIZATION. The authorized capital stock of the Company consists of
(i) 75,000,000 shares of Common Stock of which 31,899,360 shares (on a
pre-Reverse Split basis) are issued and outstanding (ii) 5,000,000 shares of
Series A Preferred Stock, par value $.001 per share, of which there were no
shares issued or outstanding and 1,000,000 shares of Series B Preferred Stock,
par value $.001 per share, of which there were no shares issued or outstanding.
The Company further has 10,802,467 shares of Common Stock issuable upon exercise
of stock options (on a pre-Reverse Split basis) and 2,460,193 shares of Common
Stock issuable upon exercise of stock warrants (on a pre-Reverse Split basis,
including warrants to purchase Series A Preferred Stock, which are convertible
into 2,285,193 shares of Common Stock). On a fully diluted basis, assuming full
exercise of all Company options and warrants, the Company would have 45,162,020
shares of Common Stock issued and outstanding (on a pre-Reverse Split basis).
All of the outstanding shares of Common Stock are, and the Company Shares when
issued in accordance with the terms hereof, will be, duly authorized, validly
issued, fully paid and nonassessable, and have not been or, with respect to the
Company Shares, will not be issued in violation of any preemptive right of
shareholders. The Common Stock is not subject to any preemptive or subscription
right, any voting trust agreement or other contract, agreement, arrangement,
option, warrant, call, commitment or other right of any character obligating or
entitling the Company to issue, sell, redeem or repurchase any of its
securities, and with the exception of the options and warrants described herein,
there are no outstanding securities of any kind convertible into, or exercisable
or exchangeable for, Common Stock.
FINANCIAL STATEMENTS. Item 8.4 to the Disclosure Schedule contains
copies of the consolidated balance sheets of the Company at March 31, 2001 and
2000 and the related statements of operations, shareholders' equity and cash
flows for the fiscal years then ended, including the notes thereto, as audited
by Morrison, Brown, Argiz & Company, certified public accountants (all such
financial statements being the "Company Financial Statements"). The Company
Financial Statements, together with the notes thereto, have been prepared in
accordance with U.S. generally accepted accounting principles applied on a basis
consistent throughout all periods presented, subject to audit adjustments, which
are not expected to be material. Such statements present fairly the financial
position of the Company as of the dates and for the periods indicated.
FURTHER FINANCIAL MATTERS. The Company does not have any material
liabilities or obligations, whether secured or unsecured, accrued, determined,
absolute or contingent, asserted or unasserted or otherwise, which are required
to be reflected or reserved in a balance sheet or the notes thereto under
generally accepted accounting principles, but which are not reflected in the
Company Financial Statements.
TAXES. Except as indicated in Item 8.6 of the Disclosure Schedule, the
Company has filed all United States federal, state, county, local and foreign
national, provincial and local returns and reports which were required to be
filed on or prior to the date hereof in respect of all income, withholding,
franchise, payroll, excise, property, sales, use, value-added or other taxes or
levies, imposts, duties, license and registration fees, charges, assessments or
withholdings of any nature whatsoever (together, "Taxes"), and has paid all
Taxes (and any related penalties, fines and interest) which have become due
pursuant to such returns or reports or which otherwise have become payable, or,
to the extent its liability for any Taxes (and any related penalties, fines and
interest) has not been fully discharged, the same have been properly reflected
as a liability on the books and records of the Company and adequate reserves
therefore have been established. All such returns and reports filed on or prior
to the date hereof have been properly prepared and are true, correct (and to the
extent such returns reflect judgments made by the Company, as the case may be,
such judgments were reasonable under the circumstances) and complete in all
Exhibit 2.1 5
material respects. Except as indicated in Item 8.6 of the Disclosure Schedule,
no tax return or tax return liability of the Company has been audited or,
presently is under audit. Except as indicated in Item 8.6 of the Disclosure
Schedule, the Company has not given or been requested to give waivers of any
statute of limitations relating to the payment of any Taxes (or any related
penalties, fines and interest). There are no claims pending or, to the knowledge
of the Company, threatened, against the Company for past due Taxes. All payments
for withholding taxes, unemployment insurance and other amounts required to be
paid for periods prior to the date hereof to any governmental authority in
respect of employment obligations of the Company, including, without limitation,
amounts payable pursuant to the Federal Insurance Contributions Act or in
respect of other payments to other parties, have been paid or shall be paid
prior to the Closing and have been duly provided for on the books and records of
the Company and in the Company Financial Statements.
INDEBTEDNESS; CONTRACTS; NO DEFAULTS.
Item 8.7 of the Disclosure Schedule sets forth a true,
complete and correct list of all material instruments, agreements, indentures,
mortgages, guarantees, notes, commitments, accommodations, letters of credit or
other arrangements or understandings, whether written or oral, to which the
Company is a party (the "Company Operating Agreements").
Except as disclosed in Item 8.7 of the Disclosure Schedule,
neither the Company, nor, to the Company's knowledge, any other person or entity
is in breach in any material respect of, or in default in any material respect
under, any material contract, agreement, arrangement, commitment or plan to
which the Company is a party, and no event or action has occurred, is pending
or, to the knowledge of the Company, is threatened, which, after the giving of
notice, passage of time or otherwise, would constitute or result in such a
material breach or material default by the Company or, to the knowledge of the
Company, any other person or entity. The Company has not received any notice of
default under any contract, agreement, arrangement, commitment or plan to which
it is a party, which default has not been cured to the satisfaction of, or duly
waived by, the party claiming such default on or before the date hereof.
PERSONAL PROPERTY.
The Company has good and marketable title to all of its
tangible personal property and assets, including, without limitation, all of the
assets reflected in the Company Financial Statements that have not been disposed
of in the ordinary course of business and such property is free and clear of all
Liens or mortgages.
REAL PROPERTY.
Item 8.9 of the Disclosure Schedule sets forth a true and
complete list of all real property owned by, or leased or subleased by or to,
the Company. The Company has good and marketable title to all of its owned real
property, including, without limitation, all of the assets reflected in the
Company Financial Statements that have not been disposed of in the ordinary
course of business and such property is free and clear of all Liens or
mortgages.
Except as set forth in Item 8.9 of the Disclosure Statement,
each lease to which the Company is a party is valid, binding and in full force
and effect with respect to the Company and, to the knowledge of the Company, all
other parties thereto; no notice of default or termination under any such lease
is outstanding.
COMPLIANCE WITH LAW.
The Company is not conducting its business or affairs in
material violation of any applicable federal, state or local law, ordinance,
rule, regulation, court or administrative order, decree or process, or any
requirement of insurance carriers. The Company has not received any notice of
violation or claimed violation of any such law, ordinance, rule, regulation,
order, decree, process or requirement.
Exhibit 2.1 6
The Company is in compliance in all material respects with all
applicable federal, state, local and foreign laws and regulations relating to
the protection of the environment and human health. There are no claims,
notices, actions, suits, hearings, investigations, inquiries or proceedings
pending or, to the knowledge of the Company, threatened against the Company that
are based on or related to any environmental matters or the failure to have any
required environmental permits, and there are no past or present conditions that
the Company has reason to believe are likely to give rise to any material
liability or other obligations of the Company under any environmental laws.
PERMITS AND LICENSES. The Company has all certificates of occupancy,
rights, permits, certificates, licenses, franchises, approvals and other
authorizations as are reasonably necessary to conduct its business and to own,
lease, use, operate and occupy its assets, at the places and in the manner now
conducted and operated, except those the absence of which would not materially
adversely affect its business. The Company has not received any written or oral
notice or claim pertaining to the failure to obtain any material permit,
certificate, license, approval or other authorization required by any federal,
state or local agency or other regulatory body, the failure of which to obtain
would materially and adversely affect its business.
ORDINARY COURSE. Since March 31, 2001, the Company has conducted its
business, maintained its real property and equipment and kept its books of
account, records and files, substantially in the same manner as previously
conducted, maintained or kept and solely in the ordinary course.
NO ADVERSE CHANGES. Since March 31, 2001, there have not been (a) any
Material Adverse Change in the business, the financial or other condition, or
the respective assets or liabilities of the Company as reflected in the Company
Financial Statements, (b) any material loss sustained by the Company, including,
but not limited to any loss on account of theft, fire, flood, explosion,
accident or other calamity, whether or not insured, which has materially and
adversely interfered, or may materially and adversely interfere, with the
operation of the Company's business, or (c) to the best knowledge of the
Company, any event, condition or state of facts, including, without limitation,
the enactment, adoption or promulgation of any law, rule or regulation, the
occurrence of which materially and adversely does or would affect the results of
operations or the business or financial condition of the Company. "Material
Adverse Change (or Effect)" means a change (or effect) in the condition
(financial or otherwise), properties, assets, prospects, liabilities, rights,
obligations, operations, or business which change (or effect), individually or
in the aggregate, is materially adverse to such condition, properties, assets,
liabilities, rights, obligations, operations, or business.
LITIGATION. Except as disclosed in Item 8.14 of the Disclosure Schedule
(and which EE&G will assume at Closing), (a) there is no claim, dispute, action,
suit, proceeding or investigation pending or, to the knowledge of the Company,
threatened, against or affecting the business of the Company, or challenging the
validity or propriety of the transactions contemplated by this Agreement, at law
or in equity or admiralty or before any federal, state, local, foreign or other
governmental authority, board, agency, commission or instrumentality, nor to the
knowledge of the Company, has any such claim, dispute, action, suit, proceeding
or investigation been pending or threatened, during the 12-month period
preceding the date hereof; (b) there is no outstanding judgment, order, writ,
ruling, injunction, stipulation or decree of any court, arbitrator or federal,
state, local, foreign or other governmental authority, board, agency, commission
or instrumentality, against or materially affecting the business of the Company
; and (c) the Company has not received any written or verbal inquiry from any
federal, state, local, foreign or other governmental authority, board, agency,
commission or instrumentality concerning the possible violation of any law, rule
or regulation or any matter disclosed in respect of its business.
INSURANCE. The Company maintains insurance against all risks
customarily insured against by companies in its industry. All such policies are
in full force and effect, and the Company has not received any notice from any
insurance company suspending, revoking, modifying or canceling (or threatening
such action) any insurance policy issued to it.
CERTIFICATE OF INCORPORATION AND BY-LAWS; MINUTE BOOKS. The copies of
the Articles of Incorporation and Bylaws (or similar governing documents) of the
Company and all amendments to each which have been or will be delivered to
Sellers are true, correct and complete. The minute books of the Company contain
true and complete records of all meetings and consents in lieu of meetings of
its Board of Directors (and any committees thereof), or similar governing
bodies, since the time of its organization. The stock books of the Company are
true, correct and complete.
Exhibit 2.1 7
EMPLOYEE BENEFIT PLANS. The Company does not maintain, nor has the
Company maintained in the past, any employee benefit plans ("as defined in
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")), or any plans, programs, policies, practices, arrangements or
contracts (whether group or individual) providing for payments, benefits or
reimbursements to employees of the Company, former employees, their
beneficiaries and dependents under which such employees, former employees, their
beneficiaries and dependents are covered through an employment relationship with
the Company, any entity required to be aggregated in a controlled group or
affiliated service group with the Company for purposes of ERISA or the Internal
Revenue Code of 1986 (the "Code") (including, without limitation, under Section
414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA, at any relevant
time ("Benefit Plans").
PATENTS, TRADEMARKS AND INTELLECTUAL PROPERTY RIGHTS. The Company does
not own or possess any patents, trademarks, service marks, trade names,
copyrights, trade secrets, licenses, information, internet web site(s) or
proprietary rights of any nature.
BROKERS AND CONSULTANTS. All negotiations relative to this Agreement
and the transactions contemplated hereby have been carried out by the Company
directly with the Sellers without the intervention of any person on behalf of
the Company in such a manner as to give rise to any valid claim by any person
against the Company for a finder's fee, brokerage commission or similar payment.
AFFILIATE TRANSACTIONS. Except as disclosed in Item 8.20 of the
Disclosure Schedule, no officer, director or employee of the Company (or any of
the relatives or Affiliates of any of the aforementioned Persons) is a party to
any agreement, contract, commitment or transaction with the Company or affecting
the business of the Company, or has any interest in any property, whether real,
personal or mixed, or tangible or intangible, used in or necessary to the
Company which will subject the Sellers to any liability or obligation from and
after the Closing Date.
TRADING. The Company's Common Stock is currently and at Closing will be
quoted on the National Association of Securities Dealers ("NASD")
Over-the-Counter Bulletin Board ("OTC"), and the Company has not received any
notice that its Common Stock is subject to being removed therefrom. The Company
and EE&G Management are unaware of any facts or circumstances which may cause
the Company's Common Stock to be removed from quotation on the OTC.
COMPLIANCE. To the Company's knowledge, the Company has complied with
all applicable foreign, federal and state laws, rules and regulations,
including, without limitation, the requirements of the Exchange Act and the
Securities Act of 1933, as amended (the "Act"), and is current in its filings
with the SEC.
ACCURACY OF INFORMATION FURNISHED. No representation, statement or
information made or provided by the Company and/or EE&G Management contained in
this Agreement (including, without limitation, the Disclosure Schedule attached
hereto) or any agreement executed in connection herewith or in any certificate
delivered pursuant hereto or thereto, contains or shall contain any untrue
statement of a material fact or omits or shall omit any material fact necessary
to make the information contained therein not misleading. The Company and EE&G
management has provided, or will provide prior to Closing, TMTI with true,
accurate and complete copies of all documents listed or described in the
Disclosure Schedule attached hereto.
SEC FILINGS. To the knowledge of the Company or EE&G Management, none
of the filings made by the Company under the Act or the Exchange Act make any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements made, in light of the circumstances under which
they were made, not misleading.
Exhibit 2.1 8
REPRESENTATIONS AND WARRANTIES OF TMTI AND MANAGEMENT SELLERS
TMTI and each of Xxxxxxx Xxxxxx and Xxx Xxxxxxx (the "Management
Sellers") represent and warrant to the Company that as of the date of the
Agreement and/or as of the Closing:
DUE ORGANIZATION AND QUALIFICATION; SUBSIDIARIES; DUE AUTHORIZATION.
TMTI is a corporation duly incorporated, validly existing and
in good standing under the laws of its jurisdiction of formation, with full
corporate power and authority to own, lease and operate its business and
properties and to carry on its business in the places and in the manner as
presently conducted or proposed to be conducted. TMTI is in good standing as a
foreign corporation in each jurisdiction in which the properties owned, leased
or operated, or the business conducted, by it requires such qualification except
for any such failure, which when taken together with all other such failures, is
not likely to have a Material Adverse Effect on the business of TMTI.
TMTI does not own, directly or indirectly, any capital stock,
equity or interest in any corporation, firm, partnership, joint venture or other
entity.
TMTI has all requisite power and authority to execute and
deliver this Agreement, and to consummate the transactions contemplated hereby.
TMTI has taken all corporate action necessary for the execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby, and
this Agreement constitutes the valid and binding obligation of TMTI enforceable
against TMTI in accordance with its terms, except as may be affected by
bankruptcy, insolvency, moratoria or other similar laws affecting the
enforcement of creditors' rights generally and subject to the qualification that
the availability of equitable remedies is subject to the discretion of the court
before which any proceeding therefore may be brought.
NO CONFLICTS OR DEFAULTS. The execution and delivery of this Agreement
by TMTI and the consummation of the transactions contemplated hereby do not and
shall not (a) contravene the Certificate of Incorporation or Bylaws of TMTI, or
(b) with or without the giving of notice or the passage of time, (i) violate,
conflict with, or result in a breach of, or a default or loss of rights under,
any material covenant, agreement, mortgage, indenture, lease, instrument, permit
or license to which TMTI is a party or by which TMTI or any of its assets are
bound, or any judgment, order or decree, or any law, rule or regulation to which
TMTI or any of its assets are subject, (ii) result in the creation of, or give
any party the right to create, any Lien upon any of the assets of TMTI, (iii)
terminate or give any party the right to terminate, amend, abandon or refuse to
perform, any material agreement, arrangement or commitment to which TMTI is a
party or by which TMTI or any of its assets are bound, or (iv) accelerate or
modify, or give any party the right to accelerate or modify, the time within
which, or the terms under which, TMTI is to perform any duties or obligations or
receive any rights or benefits under any material agreement, arrangement or
commitment to which it is a party.
CAPITALIZATION. The authorized capital stock of TMTI immediately prior
to giving effect to the transactions contemplated hereby consists of 20,000,000
shares of TMTI Common Stock of which as of the date hereof 11,300,000 shares of
Common Stock are issued and outstanding. Set forth in Schedule II is a true and
accurate list of all shareholders of TMTI, setting forth their names, addresses
and number of shares owned. All of the outstanding shares of TMTI Common Stock
are, and TMTI Common Stock when transferred in accordance with the terms hereof,
will be, duly authorized, validly issued, fully paid and non-assessable, and
have not been or, with respect to TMTI Shares, will not be transferred in
violation of any rights of third parties. The TMTI Shares are not subject to any
preemptive or subscription right, any voting trust agreement or other contract,
agreement, arrangement, option, warrant, call, commitment or other right of any
character obligating or entitling TMTI to issue, sell, redeem or repurchase any
of its securities. There are no other outstanding securities of any kind of
TMTI, including any options, warrants or debentures, convertible into,
exercisable or exchangeable for TMTI Common Stock.
Exhibit 2.1 9
FINANCIAL STATEMENTS. Exhibit 9.4 to the Disclosure Schedule contains
copies of the consolidated balance sheets of TMTI at December 31, 2000 and 1999,
and the related statements of operations, shareholders' equity and cash flows
for the periods then ended, including the notes thereto, as audited by Xxxxx &
Co., LLC, certified public accountants (all such statements being the "TMTI
Financial Statements"). The TMTI Financial Statements, together with the notes
thereto, have been prepared in accordance with U.S. generally accepted
accounting principles applied on a basis consistent throughout all periods
presented, subject to audit adjustments, which are not expected to be material.
Such statements present fairly the financial position of TMTI as of the dates
and for the periods indicated.
FURTHER FINANCIAL MATTERS.
Except as set forth in Item 9.5(a) to the Disclosure Schedule,
TMTI does not have any material liabilities or obligations, whether secured or
unsecured, accrued, determined, absolute or contingent, asserted or unasserted
or otherwise, which are required to be reflected or reserved in a balance sheet
or the notes thereto under generally accepted accounting principles, but which
are not reflected in the TMTI Financial Statements.
Attached as Item 9.5(b) of the Disclosure Schedule are true
and complete copies of forecasted operations statements and cash flow statements
of TMTI. These forecasts were prepared in good faith on the assumptions stated
therein, which assumptions were believed to be reasonable in light of conditions
existing at the time of delivery of such forecasts, and represented, at the time
of delivery, TMTI's best estimate of its future financial performance, it being
recognized that such forecasts do not constitute a warranty as to the future
performance of TMTI and that actual results may vary from forecasted results.
TAXES. Except as indicated in Item 9.6 of the Disclosure Schedule, TMTI
has filed all United States federal, state, county, local and foreign national,
provincial and local Tax returns and reports which were required to be filed on
or prior to the date hereof, and has paid all Taxes (and any related penalties,
fines and interest) which have become due pursuant to such returns or reports or
which otherwise have become payable, or, to the extent its liability for any
Taxes (and any related penalties, fines and interest) has not been fully
discharged, the same have been properly reflected as a liability on the books
and records of TMTI and adequate reserves therefore have been established. All
such returns and reports filed on or prior to the date hereof have been properly
prepared and are true, correct (and to the extent such returns reflect judgments
made by TMTI, as the case may be, such judgments were reasonable under the
circumstances) and complete in all material respects. Except as indicated in 9.6
of the Disclosure Schedule, no extension for the filing of any such return or
report is currently in effect. Except as indicated in Item 9.6 of the Disclosure
Schedule, no tax return or tax return liability of TMTI has been audited or,
presently under audit. All taxes and any penalties, fines and interest which
have been asserted to be payable as a result of any audits have been paid.
Except as indicated in Item 9.6 of the Disclosure Schedule, TMTI has not given
or been requested to give waivers of any statute of limitations relating to the
payment of any Taxes (or any related penalties, fines and interest). There are
no claims pending or, to the knowledge of TMTI, threatened, against TMTI for
past due Taxes. Except as indicated in Item 9.6 of the Disclosure Statement, all
payments for withholding taxes, unemployment insurance and other amounts
required to be paid for periods prior to the date hereof to any governmental
authority in respect of employment obligations of TMTI, including, without
limitation, amounts payable pursuant to the Federal Insurance Contributions Act
or in respect of other payments to other parties, have been paid or shall be
paid prior to the Closing and have been duly provided for on the books and
records of TMTI and in the TMTI Financial Statements.
Exhibit 2.1 10
INDEBTEDNESS; CONTRACTS; NO DEFAULTS.
Item 9.7 of the Disclosure Schedule sets forth a true,
complete and correct list of all material instruments, agreements, indentures,
mortgages, guarantees, notes, commitments, accommodations, letters of credit or
other arrangements or understandings, whether written or oral, to which TMTI is
a party (collectively, the "TMTI Operating Agreements"). An agreement shall not
be considered material for the purposes of this Section 9.7(a) if it provides
for expenditures or receipts of less than $10,000 and has been entered into by
TMTI in the ordinary course of business. The TMTI Operating Agreements
constitute all of the contracts, agreements, understandings and arrangements
required for the operation of the business of TMTI or which have a material
effect thereon. Copies of all such material written TMTI Operating Agreements
have previously been delivered or otherwise made available to the Company and
such copies are true, complete and correct as of the date hereof.
Except as disclosed in Item 9.7 of the Disclosure Schedule,
neither TMTI, nor, to TMTI's knowledge, any other person or entity is in breach
in any material respect of, or in default in any material respect under, any
material contract, agreement, arrangement, commitment or plan to which TMTI is a
party, and no event or action has occurred, is pending or is threatened, which,
after the giving of notice, passage of time or otherwise, would constitute or
result in such a material breach or material default by TMTI or, to the
knowledge of TMTI, any other person or entity. Neither TMTI has received any
notice of default under any contract, agreement, arrangement, commitment or plan
to which it is a party, which default has not been cured to the satisfaction of,
or duly waived by, the party claiming such default on or before the date hereof.
PERSONAL PROPERTY. Except as set forth in Item 9.8 of the Disclosure
Schedule, TMTI has good and marketable title to all of its tangible personal
property and assets, including, without limitation, all of the assets reflected
in the TMTI Financial Statements that have not been disposed of in the ordinary
course of business since December 31, 2000, free and clear of all Liens or
mortgages, except for any Lien for current taxes to yet due and payable and such
restrictions, if any, on the disposition of securities as may be imposed by
federal or applicable state securities laws.
REAL PROPERTY.
Item 9.9 of the Disclosure Schedule sets forth a true and
complete list of all real property owned by, or leased or subleased by or to,
TMTI (the "TMTI Real Property"). TMTI has good and marketable title to all of
its real property, including, without limitation, all of the assets reflected in
the TMTI Financial Statements that have not been disposed of in the ordinary
course of business since December 31, 2000, free and clear of all Liens or
mortgages, except for any Lien for current taxes not yet due and payable and
such restrictions, if any, on the disposition of securities as may be imposed by
federal or applicable state securities laws.
Except as set forth in Item 9.9 of the Disclosure Statement,
each lease to which TMTI is a party is valid, binding and in full force and
effect with respect to TMTI, as the case may be, and, to the knowledge of TMTI,
all other parties thereto; no notice of default or termination under any such
lease is outstanding.
COMPLIANCE WITH LAW.
Except as set forth in Item 9.10 of the Disclosure Schedule,
TMTI is not conducting its business or affairs in material violation of any
applicable federal, state or local law, ordinance, rule, regulation, court or
administrative order, decree or process, or any requirement of insurance
carriers. TMTI has not received any notice of violation or claimed violation of
any such law, ordinance, rule, regulation, order, decree, process or
requirement.
TMTI is in compliance in all material respects with all
applicable federal, state, local and foreign laws and regulations relating to
the protection of the environment and human health. There are no claims,
notices, actions, suits, hearings, investigations, inquiries or proceedings
pending or, to the knowledge of TMTI, threatened against TMTI that are based on
or related to any environmental matters or the failure to have any required
environmental permits, and there are no past or present conditions that TMTI has
reason to believe are likely to give rise to any material liability or other
obligations of TMTI under any environmental laws.
Exhibit 2.1 11
PERMITS AND LICENSES. Except as set forth in Item 9.11 of the
Disclosure Schedule, TMTI has all certificates of occupancy, rights, permits,
certificates, licenses, franchises, approvals and other authorizations as are
reasonably necessary to conduct its business and to own, lease, use, operate and
occupy its assets, at the places and in the manner now conducted and operated,
except those the absence of which would not materially adversely affect its
business. Except as set forth in Item 9.11 of the Disclosure Schedule, as of the
date hereof, TMTI has not received any written or oral notice or claim
pertaining to the failure to obtain any material permit, certificate, license,
approval or other authorization required by any federal, state or local agency
or other regulatory body, the failure of which to obtain would materially and
adversely affect its business.
ORDINARY COURSE. Except as set forth in Item 9.12 of the Disclosure
Schedule, since December 31, 2000 TMTI has conducted its business, maintained
its real property and equipment and kept its books of account, records and
files, substantially in the same manner as previously conducted, maintained or
kept and solely in the ordinary course.
NO ADVERSE CHANGES. Except as set forth in Item 9.13 of the Disclosure
Schedule, since December 31, 2000, there has not been (a) any Material Adverse
Change in the business, prospects, the financial or other condition, or the
assets or liabilities of TMTI as reflected in the TMTI Financial Statements, (b)
any material loss sustained by TMTI, including, but not limited to any loss on
account of theft, fire, flood, explosion, accident or other calamity, whether or
not insured, which has materially and adversely interfered, or may materially
and adversely interfere, with the operation of TMTI's business, or (c) to the
best knowledge of TMTI, any event, condition or state of facts, including,
without limitation, the enactment, adoption or promulgation of any law, rule or
regulation, the occurrence of which materially and adversely does or would
affect the results of operations or the business or financial condition of TMTI.
LITIGATION. (a) Except as set forth in Item 9.14 of the Disclosure
Schedule, there is no claim, dispute, action, suit, proceeding or investigation
pending or, to the knowledge of TMTI, threatened, against or affecting the
business of TMTI, or challenging the validity or propriety of the transactions
contemplated by this Agreement, at law or in equity or admiralty or before any
federal, state, local, foreign or other governmental authority, board, agency,
commission or instrumentality, nor to the knowledge of TMTI, has any such claim,
dispute, action, suit, proceeding or investigation been pending or threatened,
during the 12-month period preceding the date hereof; (b) there is no
outstanding judgment, order, writ, ruling, injunction, stipulation or decree of
any court, arbitrator or federal, state, local, foreign or other governmental
authority, board, agency, commission or instrumentality, against or materially
affecting the business of TMTI; and (c) TMTI has not received any written or
verbal inquiry from any federal, state, local, foreign or other governmental
authority, board, agency, commission or instrumentality concerning the possible
violation of any law, rule or regulation or any matter disclosed in respect of
its business.
INSURANCE. TMTI maintains insurance against all risks customarily
insured against by companies in its industry. All such policies are in full
force and effect, and TMTI has not received any notice from any insurance
company suspending, revoking, modifying or canceling (or threatening such
action) any insurance policy issued to TMTI.
CERTIFICATE OF INCORPORATION AND BY-LAWS; MINUTE BOOKS. The copies of
the Certificate of Incorporation and Bylaws (or similar governing documents) of
TMTI and all amendments to each which have been or will be delivered to the
Company are true, correct and complete. The minute books of TMTI contain true
and complete records of all meetings and consents in lieu of meetings of its
Board of Directors (and any committees thereof), or similar governing bodies,
since the time of its organization. The stock books of TMTI are true, correct
and complete.
EMPLOYEE BENEFIT PLANS. Except as set forth in Item 9.17 of the
Disclosure Schedule, TMTI does not maintain, and TMTI has not maintained in the
past, any employee benefit plans ("as defined in Section 3(3) of the "ERISA"),
or any plans, programs, policies, practices, arrangements or contracts (whether
group or individual) providing for payments, benefits or reimbursements to
employees of TMTI, former employees, their beneficiaries and dependents under
which such employees, former employees, their beneficiaries and dependents are
covered through an employment relationship with TMTI, any entity required to be
aggregated in a controlled group or affiliated service group with TMTI for
purposes of ERISA or the Internal Revenue Code of 1986 (the "Code") (including,
without limitation, under Section 414(b), (c), (m) or (o) of the Code or Section
4001 of ERISA, at any relevant time ("TMTI Benefit Plans").
Exhibit 2.1 12
PATENTS; TRADEMARKS AND INTELLECTUAL PROPERTY RIGHTS. Set forth in Item
9.18 of the Disclosure Schedule is a listing of all patents, trademarks and
intellectual property rights owned or possessed by TMTI which are material to
the conduct of the business. TMTI owns or possesses sufficient legal rights to
all patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information, internet web site(s) proprietary rights and processes
necessary for its business as now conducted without any conflict with or
infringement of the rights of others. There are no outstanding options, licenses
or agreements of any kind relating to the foregoing, and TMTI is not bound by,
or a party to, any options, licenses or agreements of any kind with respect to
the patents, trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information, proprietary rights and processes of any other person or
entity.
BROKERS AND CONSULTANTS. Except with respect to the individuals listed
on Item 9.19 of the Disclosure Schedule, all negotiations relative to this
Agreement and the transactions contemplated hereby have been carried out by TMTI
directly with the Company without the intervention of any Person on behalf of
TMTI in such a manner as to give rise to any valid claim by any Person against
TMTI or the Company for a finder's fee, brokerage commission or similar payment.
AFFILIATE TRANSACTIONS. Except as disclosed in Item 9.20 of the
Disclosure Schedule, neither TMTI nor any officer, director or employee of TMTI
(or any of the relatives or Affiliates of any of the aforementioned Persons) is
a party to any agreement, contract, commitment or transaction with TMTI or
affecting the business of TMTI, or has any interest in any property, whether
real, personal or mixed, or tangible or intangible, used in or necessary to TMTI
which will subject the Company to any liability or obligation from and after the
Closing Date.
CUSTOMERS. Listed in Item 9.21 of the Disclosure Statement are the
names of the ten largest customers (by sales revenue) of the products of TMTI,
their annual purchases of such products for the fiscal year ended December 31,
2000 and any exclusivity provisions. TMTI has previously furnished to the
Company, or will furnish prior to Closing, all copies of all written agreements
between TMTI and any such customers. Except as disclosed on Item 9.21 of the
Disclosure Statement, TMTI has not received any written notice that any such
customer has ceased or will cease being a customer for TMTI, or has
substantially reduced, or will substantially reduce, its volume of purchases of
products or services of TMTI.
ACCURACY OF INFORMATION FURNISHED. No representation, statement or
information made or provided by TMTI and/or the Management Sellers contained in
this Agreement (including, without limitation, the Disclosure Schedule and the
Schedules attached hereto) or any agreement executed in connection herewith or
in any certificate delivered pursuant hereto or thereto, contains or shall
contain any untrue statement of a material fact or omits or shall omit any
material fact necessary to make the information contained therein not
misleading. TMTI and the Management Sellers have provided (or will provide prior
to Closing) the Company with true, accurate and complete copies of all documents
listed or described in the Disclosure Schedule attached hereto.
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Each Seller represents and warrants to the Company that as of the date
of this Agreement and as of Closing:
POWER AND AUTHORITY. Each Seller has the requisite competence and
authority to execute and deliver this Agreement and to perform his respective
obligations hereunder.
ENFORCEABILITY. This Agreement has been duly executed and delivered by
each Seller and constitutes the legal, valid and binding obligation of each of
them, enforceable against each of them in accordance with its terms, except as
may be affected by applicable bankruptcy, insolvency, reorganization, moratoria
or similar laws affecting the enforcement of creditors' rights generally and
subject to the qualification that the availability of equitable remedies is
subject to the discretion of the court before which any proceeding therefor may
be brought.
Exhibit 2.1 13
COMMON STOCK AND OPTIONS. Each Seller is the sole record and beneficial
owners of all of the TMTI Common Stock set forth following his name on Schedule
II, and owns the TMTI Common Stock free and clear of all Liens, restrictions and
claims of any kind. All of the TMTI Common Stock (i) has been duly authorized
and validly issued and is fully paid, (ii) was issued in compliance with all
applicable state and federal securities laws, (iii) was not issued in violation
of any preemptive rights or rights of first refusal and (iv) was issued for not
less than fair market value in exchange for lawful consideration. There are no
proxies, voting rights or other agreements or understandings with respect to the
voting or transfer of the TMTI Common Stock.
BROKERS AND CONSULTANTS. All negotiations relative to this Agreement
and the transactions contemplated hereby have been carried out by the Sellers
directly with the Company without the intervention of any Person on behalf of
the Sellers in such a manner as to give rise to any valid claim by any Person
against TMTI or the Company for a finder's fee, brokerage commission or similar
payment.
PURCHASE FOR INVESTMENT.
Each Seller is acquiring the Company Shares for investment for
such Seller's own account and not as a nominee or agent, and not with a view to
the resale or distribution of any part thereof, and such Seller has no present
intention of selling, granting any participation in, or otherwise distributing
the same. Such Seller further represents that he does not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
a participation to such person or to any third person, with respect to any of
the Company Shares.
Each Seller understands that the Company Shares are not
registered under the Act on the ground that the sale and the issuance of
securities hereunder is exempt from registration under the Act pursuant to
Section 4(2) thereof, and that the Company's reliance on such exemption is
predicated on such Seller's representations set forth herein. Such Seller is an
"accredited investor" as that term is defined in Rule 501(a) of Regulation D
under the Act.
INVESTMENT EXPERIENCE. Each Seller acknowledges that he can bear the
economic risk of his investment, and has such knowledge and experience in
financial and business matters that he is capable of evaluating the merits and
risks of the investment in the Company Shares.
INFORMATION. The Sellers have carefully reviewed such information as
each Seller deemed necessary to evaluate an investment in the Company Shares. To
the full satisfaction of each Seller, he has been furnished all materials that
he has requested relating to the Company and the issuance of the Company Shares
hereunder, and each Seller has been afforded the opportunity to ask questions of
representatives of the Company to obtain any information necessary to verify the
accuracy of any representations or information made or given to the Sellers.
Notwithstanding the foregoing, nothing herein shall derogate from or otherwise
modify the representations and warranties of the Company set forth in this
Agreement, on which each of the Sellers has relied in making an exchange of the
TMTI Common Stock for the Common Stock.
RESTRICTED SECURITIES. Each Seller understands that the Company Shares
may not be sold, transferred, or otherwise disposed of without registration
under the Act or an exemption therefrom, and that in the absence of an effective
registration statement covering the Company Shares or any available exemption
from registration under the Act, the Company Shares must be held indefinitely.
Such Seller is aware that the Company Shares may not be sold pursuant to Rule
144 or Rule 701 promulgated under the Act unless all of the conditions of that
Rule are met. Among the conditions for use of Rule 144 or Rule 701 may be the
availability of current information to the public about the Company. Each Seller
understands that the certificates representing the Company Shares will bear the
following legend:
Exhibit 2.1 14
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE. SUCH
SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION OR AN OPINION OF COUNSEL
SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS
NOT REQUIRED BY SAID ACT OR STATE LAWS.
Each Seller understands that the Company may, unless a registration statement is
in effect covering such shares, place stop transfer orders with its transfer
agents with respect to such certificates in accordance with federal securities
laws.
INDEMNIFICATION
INDEMNITY OF TMTI AND SELLERS. The Company agrees to defend, indemnify
and hold harmless TMTI and each Seller from and against, and to reimburse TMTI
and each Seller with respect to, all liabilities, losses, costs and expenses,
including, without limitation, reasonable attorneys' fees and disbursements,
asserted against or incurred by TMTI and each Seller by reason of, arising out
of, or in connection with any material breach of any representation or warranty
contained in this Agreement made by the Company or in any document or
certificate delivered by the Company pursuant to the provisions of this
Agreement or in connection with the transactions contemplated thereby.
INDEMNITY OF THE COMPANY BY TMTI. TMTI agrees to defend, indemnify and
hold harmless the Company from and against, and to reimburse the Company with
respect to, all liabilities, losses, costs and expenses, including, without
limitation, reasonable attorneys' fees and disbursements, asserted against or
incurred by the Company by reason of, arising out of, or in connection with any
material breach of any representation or warranty contained in this Agreement
and made by the TMTI or in any document or certificate delivered by the TMTI
pursuant to the provisions of this Agreement or in connection with the
transactions contemplated thereby.
INDEMNITY OF THE COMPANY BY EE&G Management. EE&G Management agrees to
defend, indemnify and hold harmless the Company from and against, and to
reimburse the Company with respect to, all liabilities, losses, costs and
expenses, including, without limitation, reasonable attorneys' fees and
disbursements, asserted against or incurred by the Company by reason of, arising
out of, or in connection with any material breach of any representation or
warranty contained in Section 7 of this Agreement and made by EE&G Management or
in any document or certificate delivered by EE&G Management pursuant to the
provisions of this Agreement or in connection with the transactions contemplated
thereby.
INDEMNIFICATION OF THE COMPANY BY THE SELLERS. The Sellers agree to
defend, indemnify and hold harmless the Company from and against, and to
reimburse the Company with respect to, all liabilities, losses, costs and
expenses, including, without limitation, reasonable attorneys' fees and
disbursements, asserted against or incurred by the Company by reason of, arising
out of, or in connection with any material breach of any representation or
warranty contained in Article X of this Agreement and made by the Sellers or in
any document or certificate delivered by the Sellers pursuant to the provisions
of this Agreement or in connection with the transactions contemplated thereby.
INDEMNIFICATION PROCEDURE. A Party (an "Indemnified Party") seeking
indemnification shall give prompt notice to the other Party (the "Indemnifying
Party") of any claim for indemnification arising under this Article XI. The
Indemnifying Party shall have the right to assume and to control the defense of
any such claim with counsel reasonably acceptable to such Indemnified Party, at
the Indemnifying Party's own cost and expense, including the cost and expense of
reasonable attorneys' fees and disbursements in connection with such defense, in
which event the Indemnifying Party shall not be obligated to pay the fees and
disbursements of separate counsel for such Indemnified Party in such action. In
the event, however, that such Indemnified Party's legal counsel shall determine
that defenses may be available to such Indemnified Party that are different from
or in addition to those available to the Indemnifying Party, in that there
Exhibit 2.1 15
could reasonably be expected to be a conflict of interest if such Indemnifying
Party and the Indemnified Party have common counsel in any such proceeding, or
if the Indemnified Party has not assumed the defense of the action or
proceedings, then such Indemnifying Party may employ separate counsel to
represent or defend such Indemnified Party, and the Indemnifying Party shall pay
the reasonable fees and disbursements of counsel for such Indemnified Party. No
settlement of any such claim or payment in connection with any such settlement
shall be made without the prior consent of the Indemnifying Party which consent
shall not be unreasonably withheld.
INDEMNIFICATION LIMITS. No Party may seek damages form any other Party
pursuant to this Article XI until such Party has incurred $25,000 in damages in
the aggregate (which shall include, but is not limited to, all liabilities,
losses, lost and expenses) resulting from the acts or omissions of the
Indemnifying Party. Additionally, under no circumstances will the obligations of
any Party under this Article XI exceed $1,000,000.
COVENANTS
TAKING OF NECESSARY ACTION; FURTHER ACTION. Each of the Company, TMTI,
the Sellers and each member of EE&G Management will take all such reasonable and
lawful action as may be necessary or appropriate in order to effectuate the
Transactions as promptly as possible in accordance with this Agreement.
DISCLOSURE DOCUMENTS. None of the information supplied or to be
supplied by any Party or any of their affiliates, directors, officers,
employees, agents or representatives, in writing specifically for inclusion or
incorporation by reference in, and which is included or incorporated by
reference in, (i) the Information Statement referenced in Section 5.3 of this
Agreement or any amendment or supplement thereto, or (ii) any other documents
filed or to be filed by the Company with the SEC or any other governmental
authority in connection with the transactions contemplated hereby, will, at the
respective times such documents are filed, be false or misleading with respect
to any material fact, or omit to state any material fact necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading or necessary to correct any statement in any earlier
communication with respect to such Information Statement.
INTERIM OPERATIONS.
During the period from the date of this Agreement and continuing until
the earlier of the termination of this Agreement or the Closing, except as set
forth in the Disclosure Schedule, or unless the other Parties have consented in
writing thereto (which consent shall not be unreasonably withheld), TMTI and the
Company shall:
conduct their respective operations according to their usual,
regular and ordinary course in substantially the same manner as heretofore
conducted, except that the Company may take such actions as may be necessary or
appropriate to (i) transfer any ECOS Assets or ECOS Liabilities to EE&G or (ii)
assign any Company Operating Agreements to EE&G pursuant to Section 12.8;
to the extent consistent with their respective businesses, use
commercially reasonable efforts to preserve intact their respective business
organizations and goodwill, keep available the services of their respective
officers and employees and maintain satisfactory relationships with those
persons having business relationships with them;
not amend their respective Articles of Incorporation or Bylaws
or comparable governing instruments;
promptly notify the other Parties of the occurrence of any
Material Adverse Change, any litigation or governmental complaints,
investigations or hearings (or communications indicating that the same may be
contemplated), or the breach of any representation or warranty contained herein;
Exhibit 2.1 16
not (i) except pursuant to the exercise of options, warrants,
conversion rights and other contractual rights existing on the date hereof and
disclosed pursuant to this Agreement, issue any shares of its capital stock,
effect any stock split or otherwise change its capitalization as it existed on
the date hereof; (ii) grant, confer or award any option, warrant, conversion
right or other right not existing on the date hereof to acquire any shares of
its capital stock; (iii) increase any compensation or enter into or amend any
employment agreement with any of its present or future officers, directors or
employees; (iv) grant any severance or termination package to any employee or
consultant, except to the extent consistent with past practices; or (v) adopt
any new employee benefit plan (including any stock option, stock benefit or
stock purchase plan) or amend any existing employee benefit plan in any material
respect, except for changes which are less favorable to participants in such
plans;
not (i) declare, set aside or pay any dividend or make any
other distribution or payment with respect to any shares of its capital stock or
other ownership interests; or (ii) directly or indirectly, redeem, purchase or
otherwise acquire any shares of its capital stock, or make any commitment for
any such action;
not enter into any agreement or transaction, or agree to enter
into any agreement or transaction, outside the ordinary course of business,
including, without limitation, any transaction involving a merger,
consolidation, joint venture, license agreement, partial or complete liquidation
or dissolution, reorganization, recapitalization, restructuring or a purchase,
sale, lease or other disposition of a portion of assets or capital stock;
not incur any indebtedness for borrowed money or guarantee any
such indebtedness except in the ordinary course of business consistent with past
practice or issue or sell any debt securities or warrants or rights to acquire
any debt securities of others;
indebtedness, leases and other obligations;
not make any loans, advances or capital contributions to, or
investments in, any other Person;
not make or commit to make any capital expenditures in excess
of $100,000 individually or $200,000 in the aggregate;
not apply any of its assets to the direct or indirect payment,
discharge, satisfaction or reduction of any amount payable directly or
indirectly to or for the benefit of any affiliate or enter into any transaction
with any affiliate (except for payment of salary and other customary expense
reimbursements made in the ordinary course of business to affiliates who are
employees, directors or consultants of the Company or TMTI);
not voluntarily elect to alter the manner of keeping its
books, accounts or records, or change in any manner the accounting practices
therein reflected, except for changes in accounting laws which affect all
companies in the business of the Company or TMTI generally and those indicated
by good accounting practices;
not grant or make any mortgage or pledge or subject itself or
any of its properties or assets to any lien, charge or encumbrance of any kind;
and
maintain insurance on its tangible assets and its businesses
in such amounts and against such risks and losses as are currently in effect.
PUBLICITY. None of the Parties hereto shall make any press release or
public announcement with respect to this Agreement or the transactions
contemplated hereby without the prior written consent of the other Parties
(which consent shall not be unreasonably withheld); provided, however, that the
Company may make any disclosure or announcement which such party, in the opinion
of its legal counsel, is obligated to make pursuant to applicable law or
regulation of the NASD, in which case the party desiring to make the disclosure
shall consult with the other Parties prior to making such disclosure or
announcement.
Exhibit 2.1 17
TAX TREATMENT OF TRANSACTIONS. From and after the date hereof and until
the Closing, none of the Parties shall (a) knowingly take any action, or
knowingly fail to take any action, that would jeopardize qualification of the
Share Exchange as a reorganization within the meaning of Section 368(a) of the
Code or the transfer of EE&G as a split-off within the meaning of Section 355 of
the Code; or (b) enter into any contract, agreement, commitment or arrangement
with respect to the foregoing. After the Closing, the Parties shall not take or
fail to take any action that is reasonably likely to jeopardize qualification of
the Share Exchange as a reorganization within the meaning of Section 368(a) of
the Code or the Transfer of EE&G as a split-off within the meaning of Section
355 of the Code.
TAXATION. If the transfer to EE&G Management of the EE&G Common Stock
results in a taxable event to EE&G Management, the Sellers agree to reimburse
members of EE&G Management for one-half of all federal income taxes owed by
members of EE&G Management resulting from such sale, up to a maximum of $30,000
(total tax of $60,000).
POST-CLOSING ISSUANCES BY TMTI. After Closing, TMTI and the Sellers
agree not to issue, or enter any agreement for the issuance of, any option,
security or other instrument convertible into, or exercisable for, TMTI Common
Stock.
ASSIGNMENT OF CERTAIN AGREEMENTS. Prior to Closing, the Company agrees
to assign to EE&G all of the agreements set forth on Item 8.7 to the Disclosure
Schedule.
NO REGISTRATION. The Sellers acknowledge that the Company Shares being
delivered hereunder are not registered shares and agree that they will not, or
cause the Company to, file a registration statement with the SEC for the resale
of the Company Shares by the Sellers at any time prior to the one (1) year
anniversary of this Agreement, except as provided immediately below. If at any
time ninety (90) or more calendar days after Closing the Company proposes to
register any of the Common Stock under the Securities Act in connection with any
transaction raising capital for the Company, the Company shall at such time
promptly give Sellers written notice of such registration. If within twenty (20)
days after delivery of such notice, the Company receives a written request from
the Sellers to register any of the Company Shares, the Company shall cause to be
registered for resale under the Securities Act up to ten percent (10 %) of the
Company Shares in such amounts and for such persons as the Sellers instruct.
COMPANY OPTIONS. The Company shall extend by nine (9) additional months
the expiration date of the options to purchase Common Stock previously granted
to the employees and directors of the Company (and which are not being
terminated pursuant to this Agreement).
CLOSING DELIVERIES
Items to be delivered to TMTI or Sellers prior to or at Closing by the
Company. Prior to or at Closing, the Company and EE&G Management will deliver
the following to TMTI and/or Sellers:
articles of incorporation and amendments thereto, bylaws and
amendments thereto, certificate of good standing in the Company's state
of incorporation;
all applicable schedules hereto;
all minutes and resolutions of board of director and
shareholder meetings in possession of the Company;
a shareholder list;
all financial statements and tax returns in possession of the
Company;
Exhibit 2.1 18
an Officer's Certificate stating that the representations and
warranties of the Company and EE&G Management contained in this Agreement and in
any document delivered in connection herewith shall be true and correct, in all
material respects as of the Closing (except to the extent such representations
and warranties speak as of a specified earlier date and except as specifically
contemplated by this Agreement);
a resolution from the Company's current directors appointing
designees of TMTI to the Company's Board of Directors;
letters of resignation from the Company's current officers and
directors to be effective upon Closing and after the appointments described in
this section;
certificates representing 6,875,000 post-Reverse Split shares
of the Common Stock issued in the denominations as set forth opposite the
Seller's respective names on Schedule II to this Agreement, duly authorized,
validly issued, fully paid for and ;
copies of board, and if applicable, shareholder resolutions
approving this transaction and authorizing the issuances of the shares hereto;
creditor releases and indemnification and hold-harmless
agreements to the satisfaction of TMTI, releasing TMTI from any and all ECOS
Liabilities either known or unknown up to the date of Closing;
certificates representing the Held Back Shares (which shall be
retained in escrow by the Company);
an escrow letter executed by the Company agreeing to hold the
Held Back Shares in escrow in accordance with the provisions of Article VI of
this Agreement;
any other document reasonably requested by TMTI that it deems
necessary for the consummation of the transactions; and
opinion of Akerman, Senterfitt & Xxxxxx, P.A. as to the
matters set forth in Exhibit A.
Items to be delivered to the Company prior to or at Closing by TMTI and
the Sellers. Prior to or at Closing, TMTI and the Sellers will deliver the
following to the Company:
articles of incorporation and amendments thereto, bylaws and
amendments thereto, certificate of good standing in the TMTI's state of
incorporation;
all applicable schedules hereto;
all minutes and resolutions of board of director and
shareholder meetings in possession of the Company;
a shareholder list;
all financial statements and tax returns in possession of the
Company;
a resolution from TMTI's current directors designating persons
to be appointed to the Company's Board of Directors;
certificates representing all of TMTI's issued and outstanding
common stock as set forth opposite the Seller's respective names on Schedule II
to this Agreement, duly authorized, validly issued, fully paid for and
nonassessable with stock powers enabling proper transfer of the TMTI Common
Stock;
copies of board, and if applicable, shareholder resolutions
approving this transaction;
Exhibit 2.1 19
copies of TMTI's current business plan; and
an Officer's Certificate stating that he representations and
warranties of TMTI and Management Sellers contained in this Agreement and in any
document delivered in connection herewith shall be true and correct in all
material respects, as of the Closing (except to the extent such representations
and warranties speak of a specified earlier date and except as specifically
contemplated by this Agreement); any other document reasonably requested by the
Company that it deems necessary for the consummation of the transactions.
an opinion of Deutch and Xxxx as to the matters set forth in
Exhibit B.
Items to be delivered to the Company by EE&G Management. At Closing,
EE&G Management will deliver the following to the Company:
certificate for 6,259,385 shares of Common Stock with stock
powers;
executed Option Termination Agreements from members of EE&G
Management relating to the options to purchase 6,009,385 shares of Common Stock;
and
any other document reasonably requested by the Company that it
deems necessary for the consummation of the transactions.
Items to be delivered to EE&G Management by the Company. At Closing,
the Company will deliver the following to EE&G Management.
certificates for all of the issued and outstanding shares EE&G
common stock with stock powers enabling the proper transfer of EE&G Common Stock
to the persons and in the amounts set forth in Schedule I;
all duly executed instruments of transfer and assignment for
the EE&G Assets required pursuant to Section 1.3 of this Agreement;
the corporate books and records of EE&G; and
any other document reasonably requested by the Company that it
deems necessary for the consummation of the Transaction.
CONDITIONS PRECEDENT
CONDITIONS PRECEDENT TO CLOSING. The obligations of the Parties under
this Agreement shall be and are subject to fulfillment, prior to or at the
Closing, of each of the following conditions:
that the Parties shall have performed or complied with all
agreements, terms and conditions required by this Agreement to be performed or
complied with by them prior to or at the time of the Closing;
that the Parties shall be reasonably satisfied as a result of
their due diligence and review of the other books and records that the
representations and warranties made by the other Parties in this Agreement are
materially true and correct;
that the Parties shall have received a fairness opinion from
Capital Link, L.C., or another independent third-party mutually acceptable by
the Parties (the "Fairness Opinion"), that the transactions contemplated by this
Agreement and the terms hereof are fair and reasonable to the Parties from a
financial point of view and the Fairness Opinion has not been withdrawn;
Exhibit 2.1 20
that the value of EE&G mutually determined by EE&G Management
and ECOS in good faith prior to Closing based on the range of values set forth
in the Fairness Opinion be less than $750,000 at Closing;
no preliminary or permanent injunction or other order or
decree by any federal or state court which prevents the consummation of the
Transactions or changes the terms or conditions of this Agreement shall have
been issued and remain in effect; provided, however, that if any such order or
injunction shall have been issued, each Party agrees to use its reasonable
efforts to have any such injunction lifted;
the representations and warranties of TMTI and the Sellers
contained in this Agreement and in any document delivered in connection herewith
shall be true and correct in all material respects, as of the Closing (except to
the extent such representations and warranties speak of a specified earlier date
and except as specifically contemplated by this Agreement), and the Company
shall have received a certificate of the President of TMTI, dated the Closing
Date, certifying to such effect;
the Company shall have received from TMTI certified copies of
the resolutions of TMTI's Board of Directors and shareholders approving and
adopting this Agreement and the Transactions;
from the date of this Agreement through the Closing, there
shall not have occurred any event that has had a Material Adverse Effect on the
Company or TMTI;
TMTI shall have executed and delivered such other documents
and taken such other actions as the Company shall reasonably request;
the representations and warranties of the Company, and EE&G
Management contained in this Agreement and in any document delivered in
connection herewith shall be true and correct, in all material respects, as of
the Closing (except to the extent such representations and warranties speak as
of a specified earlier date and except as specifically contemplated by this
Agreement), and TMTI shall have received a certificate of the Chairman or
President of the Company, dated the Closing Date, certifying to such effect;
TMTI shall have received from the Company certified copies of
the resolutions of the Company's Board of Directors and shareholders approving
and adopting this Agreement and the Transactions;
the Company shall have received the opinion of Deutch and Xxxx
as to the matters set forth in Exhibit B;
the Company shall have assigned all of the agreements set
forth on Item 8.7 of the Disclosure Schedule to EE&G;
TMTI shall have received the opinion of Akerman, Senterfitt &
Xxxxxx, P.A. as to the matters set forth in Exhibit A.
This Agreement and the Transactions shall have been approved
and adopted by the requisite vote of the shareholders of the Company; and
The Information Statement shall have been (i) filed with, and
accepted by, the SEC and (ii) mailed to all of the Company's shareholders at
least twenty (20) calendar days prior to the Closing.
Exhibit 2.1 21
TERMINATION OR RESCISSION
TERMINATION. This Agreement may be terminated at any time before or at
Closing, by:
the mutual agreement of the Parties;
any non-breaching Party upon the breach of any
material representation or warranty contained in this
Agreement;
any Party if any legal proceeding shall have been
instituted or shall be imminently threatening to delay,
restrain or prevent the consummation of this Agreement; or
any Party if the conditions precedent to Closing are
not satisfied prior to August 31, 2001, unless the Party
seeking termination is the Party that has failed to satisfy or
caused the failure to satisfy the conditions precedent.
any Party within seven (7) business days after the
date of delivery of any Item of the Disclosure Schedule if
such Party discovers any Material Adverse Change in the
Company or TMTI in such Item of the Disclosure Schedule
delivered after the date hereof, unless the Party seeking
termination had knowledge of such Material Adverse Change
prior to the execution of this Agreement.
Upon termination of this Agreement for any reason, in
accordance with the terms and conditions set forth in this paragraph, each said
party shall bear all costs and expenses as each party has incurred and no party
shall be liable to the other.
MISCELLANEOUS
SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. All
representations and warranties and statements made by a Party to in this
Agreement or in any document or certificate delivered pursuant hereto shall
survive the Closing Date for a period of one year. Each of the Parties is
executing and carrying out the provisions of this Agreement in reliance upon the
representations, warranties and covenants and agreements contained in this
Agreement or at the Closing of the transactions herein provided for and not upon
any investigation which it might have made or any representations, warranty,
agreement, promise or information, written or oral, made by the other party or
any other person other than as specifically set forth herein.
ACCESS TO BOOKS AND RECORDS. During the course of this transaction
through Closing, each Party agrees to make available for inspection all
corporate books, records and assets, and otherwise afford to each other and
their respective representatives, reasonable access to all documentation and
other information concerning the business, financial and legal conditions of
each other for the purpose of conducting a due diligence investigation thereof.
Such due diligence investigation shall be for the purpose of satisfying each
party as to the business, financial and legal condition of each other for the
purpose of determining the desirability of consummating the proposed
transaction. The Parties further agree to keep confidential and not use for
their own benefit, except in accordance with this Agreement any information or
documentation obtained in connection with any such investigation.
FURTHER ASSURANCES. If, at any time after the Closing, the parties
shall consider or be advised that any further deeds, assignments or assurances
in law or that any other things are necessary, desirable or proper to complete
the merger in accordance with the terms of this agreement or to vest, perfect or
confirm, of record or otherwise, the title to any property or rights of the
parties hereto, the Parties agree that their proper officers and directors shall
execute and deliver all such proper deeds, assignments and assurances in law and
do all things necessary, desirable or proper to vest, perfect or confirm title
to such property or rights and otherwise to carry out the purpose of this
Agreement, and that the proper officers and directors the parties are fully
authorized to take any and all such action.
Exhibit 2.1 22
NOTICE. All communications, notices, requests, consents or demands
given or required under this Agreement shall be in writing and shall be deemed
to have been duly given when delivered to, or received by prepaid registered or
certified mail or recognized overnight courier addressed to, or upon receipt of
a facsimile sent to, the party for whom intended, as follows, or to such other
address or facsimile number as may be furnished by such party by notice in the
manner provided herein:
If to the Company or EE&G Management:
Xxxxxxx Xxxxx, President
ECOS Group, Inc.
00000 Xxxxxxxx Xxx, Xxxxx 000
Xxxxx Xxxxx, Xxxxxxx 00000
Tel: (000) 000-0000
If to the Sellers:
Xxxxxxx Xxxxxx, President
Third Millennium Telecommunications, Inc.
000 Xxx Xxx Xxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
ENTIRE AGREEMENT. This Agreement, the Disclosure Schedule and any
instruments and agreements to be executed pursuant to this Agreement, sets forth
the entire understanding of the parties hereto with respect to its subject
matter, merges and supersedes all prior and contemporaneous understandings with
respect to its subject matter and may not be waived or modified, in whole or in
part, except by a writing signed by each of the parties hereto. No waiver of any
provision of this Agreement in any instance shall be deemed to be a waiver of
the same or any other provision in any other instance. Failure of any party to
enforce any provision of this Agreement shall not be construed as a waiver of
its rights under such provision.
EXPENSES; SALES TAX. Except as otherwise provided herein, the Parties
shall pay their own fees and expenses, including their own counsel fees,
incurred in connection with this Agreement or the Transactions. The parties
agree that the Company and EE&G Management shall equally bear all sales,
transfer or similar taxes required to be paid by reason of the transfer by the
Company of the Purchased Assets pursuant to this Agreement.
SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon,
enforceable against and inure to the benefit of, the parties hereto and their
respective heirs, administrators, executors, personal representatives,
successors and assigns, and nothing herein is intended to confer any right,
remedy or benefit upon any other person. This Agreement may not be assigned by
any party hereto except with the prior written consent of the other parties,
which consent shall not be unreasonably withheld.
GOVERNING LAW. This Agreement shall in all respects be governed by and
construed in accordance with the laws of the State of Florida are applicable to
agreements made and fully to be performed in such state, without giving effect
to conflicts of law principles.
COUNTERPARTS. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument; provided, however, that this Agreement
shall not become effective until executed by all of the Parties hereto.
Exhibit 2.1 23
ARM'S-LENGTH NEGOTIATIONS. Each Party herein expressly represents and
warrants to all other Parties hereto that (a) before executing this Agreement,
said Party has fully informed itself of the terms, contents, conditions and
effects of this Agreement; (b) said Party has relied solely and completely upon
its own judgment in executing this Agreement; (c) said Party has had the
opportunity to seek and has obtained the advice of counsel before executing this
Agreement; (d) said Party has acted voluntarily and of its own free will in
executing this Agreement; (e) said Party is not acting under duress, whether
economic or physical, in executing this Agreement; and (f) this Agreement is the
result of arm's length negotiations conducted by and among the Parties and their
respective counsel.
CONSTRUCTION. Headings contained in this Agreement are for convenience
only and shall not be used in the interpretation of this Agreement. References
herein to Articles, Sections and Exhibits are to the articles, sections and
exhibits, respectively, of this Agreement. The Disclosure Schedule is hereby
incorporated herein by reference and made a part of this Agreement. As used
herein, the singular includes the plural, and the masculine, feminine and neuter
gender each includes the others where the context so indicates.
SEVERABILITY. If any provision of this Agreement is held to be invalid
or unenforceable by a court of competent jurisdiction, this Agreement shall be
interpreted and enforceable as if such provision were severed or limited, but
only to the extent necessary to render such provision and this Agreement
enforceable.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
Exhibit 2.1 24
IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement as of the date first set forth above.
ECOS GROUP, INC. EE&G MANAGEMENT:
By: /s/ Xxxxxxx Xxxxx /s/ Xxxxxxx Xxxxx
------------------ ----------------------------------------
Name: Xxxxxxx Xxxxx Xxxxxxx Xxxxx
Title: President
/s/ Xxxxxxx X. Xxxx
----------------------------------------
Xxxxxxx X. Xxxx
THIRD MILLENNIUM /s/ Xxxxx Xxxx
----------------------------------------
TELECOMMUNICATIONS, INC. ("TMTI") Xxxxx Xxxx
/s/ Xxxxx Xxxxxxxxx
----------------------------------------
By: /s/ Xxxxxxx Xxxxxx Xxxxx Xxxxxxxxx
Name: Xxxxxxx Xxxxxx
Title: President /s/ Xxx Xxxx
----------------------------------------
Xxx Xxxx
SELLERS: /s/ Xxxx Xxxxxxx
---------------------------
Xxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxx /s/ Xxxxxxx Xxxxxxxxxx
----------------------- ---------------------------
Xxxxxxx Xxxxxx Xxxxxxx Xxxxxxxxxx
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxxxx
----------------------- ---------------------------
Xxxxxx Xxxxxxx Xxxxxx Xxxxxxxx
/s/ Xx Xxxxxx /s/ Xxxxxx Xxxxxxxxx
----------------------- ---------------------------
Xx Xxxxxx Xxxxxx Xxxxxxxxx
/s/ Xxx Xxxx
-----------------------
Xxx Xxxx
/s/ Aspen Ridge Corp
-----------------------
Aspen Ridge Corp
/s/ Xxxxxxxxx.xxx
-----------------------
Xxxxxxxxx.xxx
/s/ Xxxxxxx Xxx Xxxx
-----------------------
Xxxxxxx Xxx Xxxx
/s/ Xxxxxxx Xxxx Trust II
-----------------------
Xxxxxxx Xxxx Trust II
Exhibit 2.1 25
SCHEDULE I
EE&G MANAGEMENT
Number of Options and
Number of Shares Warrants to Purchase EE&G Common
of Common Stock Shares of Common Stock to Stock to be % of EE&G
Name to be Cancelled be Cancelled Received Common Stock
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxxxx Xxxxx 2,508,395 2,530,930 160 40.00
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxxxx X Xxxx 2,407,933 2,378,644 154 38.50
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxx Xxxx 301,706 251,488 19 4.75
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxx Xxxxxxxxx 279,000 223,200 18 4.50
------------------------ ------------------- --------------------------- ----------------- -------------
Xxx Xxxx 281,000 215,200 18 4.50
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxx Xxxxxxx 170,454 132,134 11 2.75
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxxxx Xxxxxxxxxx 169,441 163,787 11 2.75
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxxx Xxxxxxxx 110,149 92,882 7 1.75
------------------------ ------------------- --------------------------- ----------------- -------------
Xxxxxx Xxxxxxxxx 31,307 21,120 2 0.50
------------------------ ------------------- --------------------------- ----------------- -------------
6,259,385 6,009,385 400 100%
Exhibit 2.1 26
SCHEDULE II
Number of TMTI
Shares
Delivered at Number of Held Back
Seller's Name and Address Closing Number of Company Shares Shares
------------------------------ ------------------ --------------------------- -----------------------
Xxxxxxx Xxxxxx 4,998,000 2,962,369 15,480,530
Xxxxxx Xxxxxxx 3,332,000 1,974,913 10,320,354
Xx Xxxxxx 435,000 257,829 1,347,345
Xxx Xxxx 435,000 257,829 1,347,345
Aspen Ridge Corp. 550,000 414,674 1,703,540
Xxxxxxxxx.xxx 550,000 414,674 1,703,540
Xxxxxxx Xxx Xxxx 500,000 296,356 1,548,673
Xxxxxxx Xxxx Trust II 500,000 296,356 1,548,673
------------------ --------------------------- -----------------------
11,300,000 6,875,000 35,000,000
Exhibit 2.1 27
