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Exhibit 10.1
AGREEMENT AND PLAN OF MERGER
by and among
ENTERTAINMENT DIGITAL NETWORK, INC.,
VISUAL DATA SAN FRANCISCO, INC.
and
VISUAL DATA CORPORATION
DATED AS OF JUNE 4, 2001
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of June 4, 2000 (the
"Agreement"), by and among ENTERTAINMENT DIGITAL NETWORK, INC., a Delaware
corporation ("EDNET"), VISUAL DATA CORPORATION, a Florida corporation ("VDAT"),
and VISUAL DATA SAN FRANCISCO, INC., a Florida corporation ("SUB"), which is a
direct wholly-owned subsidiary of VDAT. EDNET and SUB are hereinafter sometimes
collectively referred to as the "Constituent Corporations."
RECITALS
A. VDAT owns a 51% equity interest in EDNET.
B. The Boards of Directors of EDNET, VDAT and SUB deem it advisable and
in the best interests of each corporation and its respective shareholders that
EDNET and VDAT combine in order to advance their long-term business interests,
all upon the terms and subject to the conditions of this Agreement.
C. It is intended that the combination be effected by a merger of EDNET
with and into SUB with SUB surviving, which for Federal income tax purposes
shall be a tax-free reorganization as described in the Internal Revenue Code of
1986, as amended (the "Code").
NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants, agreements and conditions contained
herein, the parties hereto agree as follows:
ARTICLE I
THE MERGER
Section 1.1 THE MERGER. (a) In accordance with the provisions of this
Agreement, the Florida Business Corporation Act ("FBCA") and the Delaware
General Corporation Law ("DGCL"), at the Effective Time, EDNET shall be merged
(the "Merger") with and into SUB, and SUB shall be the surviving corporation
(hereinafter sometimes called the "Surviving Corporation") and shall continue
its corporate existence under the laws of the State of Florida. The name of the
Surviving Corporation shall be Entertainment Digital Network, Inc. At the
Effective Time, the separate existence of EDNET shall cease.
(b) The Merger shall have the effects on EDNET and SUB, as Constituent
Corporations of the Merger, provided for under the DGCL and FBCA.
Section 1.2 EFFECTIVE TIME. The Merger shall become effective at the
time of filing of, or at such later time as specified in, an agreement of
merger, in the form required by and executed
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in accordance with the DGCL and the FBCA, with the Secretary of State of the
State of Florida in accordance with the provisions of Sections 607.1101 and
607.1103 of the FBCA and with the Secretary of State of the State of Delaware in
accordance with the provisions of Section 252 of the DGCL (the "Certificate of
Merger"). The date and time when the Merger shall become effective is herein
referred to as the "Effective Time."
Section 1.3 ARTICLES OF INCORPORATION AND BYLAWS OF SURVIVING
CORPORATION. The Articles of Incorporation and Bylaws of SUB as in effect
immediately prior to the Effective Time shall be the Articles of Incorporation
and Bylaws of the Surviving Corporation until thereafter amended as provided by
law.
Section 1.4 DIRECTORS AND OFFICERS OF SURVIVING CORPORATION. (a) The
directors of the Surviving Corporation shall be the same as VDAT at the
Effective Time, consistent with this Agreement and will hold office from and
after the Effective Time until their respective successors are duly elected or
appointed and qualify in the manner provided in the Articles of Incorporation
and Bylaws of the Surviving Corporation or as otherwise provided by law or their
earlier resignation or removal.
(b) The officers of EDNET immediately prior to the Effective Time shall
be the officers of the Surviving Corporation and each will hold office from and
after the Effective Time until their respective successors are duly appointed
and qualify in the manner provided in the Bylaws of the Surviving Corporation or
as otherwise provided by law or their earlier resignation or removal.
Section 1.5 FURTHER ASSURANCES. If, at any time after the Effective
Time, the Surviving Corporation shall consider or be advised that any deeds,
bills of sale, assignments, assurances or any other actions or things are
necessary or desirable to vest, perfect or confirm of record or otherwise in the
Surviving Corporation its right, title or interest in, to or under any of the
rights, properties or assets of either of the Constituent Corporations acquired
or to be acquired by the Surviving Corporation as a result of, or in connection
with, the Merger or otherwise to carry out this Agreement, the officers and
directors of the Surviving Corporation shall be authorized to execute and
deliver, in the name and on behalf of each of the Constituent Corporations or
otherwise, all such deeds, bills of sale, assignments and assurances and to take
and do, in the name and on behalf of each of the Constituent Corporations or
otherwise, all such other actions and things as may be necessary or desirable to
vest, perfect or confirm any and all right, title and interest in, to and under
such rights, properties or assets in the Surviving Corporation or otherwise to
carry out this Agreement.
ARTICLE II
CONVERSION OF SHARES
Section 2.1 EFFECT ON EDNET SHARES. As of the Effective Time, by virtue
of the Merger and without any action on the part of the holders thereof:
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(a) Every ten (10) shares of EDNET's common stock, par value $.001 per
share (the "EDNET Shares"), issued and outstanding immediately prior to the
Effective Time shall be converted into the right to receive one (1) share of
VDAT Common Stock, $.0001 par value per share (the "VDAT Common Stock").
(b) All EDNET Shares other than shares of EDNET owned by VDAT which
shall be canceled shall be canceled and retired, and each certificate
representing any such EDNET Shares shall thereafter (i) represent only the right
to receive the VDAT Common Stock issuable in exchange for such EDNET Shares upon
the surrender of such certificates in accordance with Section 2.4 (and any cash
payable in respect of fractional shares) and (ii) entitle the holder thereof to
vote with respect to, and receive dividends on, such number of whole shares of
VDAT Common Stock which such holder is entitled to receive in exchange for such
certificates, provided that dividends shall be paid to such holder, without
interest, only upon surrender of certificates in accordance with Section 2.4.
(c) Notwithstanding anything to the contrary in this Agreement, any
holder of EDNET Shares who shall exercise the rights of a dissenting shareholder
pursuant to and strictly in accordance with the provisions of Section 262 of the
DGCL shall be entitled to receive only the payment therein provided for and
shall not be entitled to receive VDAT Common Stock. Such payment shall be made
directly by the Surviving Corporation.
Section 2.2 EFFECT ON EDNET OPTIONS AND WARRANTS. Every EDNET option or
warrant issued and outstanding immediately prior to the Effective Time shall be
converted into the right to receive an option or warrant of VDAT based upon the
exchange ratio set forth in Section 2.1(a).
Section 2.3 SUB COMMON STOCK. Each share of common stock, $.0001 par
value, of SUB issued and outstanding immediately prior to the Effective Time
shall remain outstanding.
Section 2.4 EXCHANGE PROCEDURES. (a) VDAT shall authorize its transfer
agent to act as exchange agent hereunder (the "Exchange Agent") for the purposes
of exchanging certificates representing EDNET Shares and shares of VDAT Common
Stock. As promptly as practicable after the Effective Time, VDAT shall deposit
with the Exchange Agent, in trust for the holders of Certificates (as defined in
Section 2.4(b) below), certificates representing the shares of VDAT Common Stock
issuable pursuant to Section 2.1(a) in exchange for EDNET Shares (the "EDNET
Certificates").
(b) Promptly after the Effective Time, the Exchange Agent shall mail or
cause to be mailed to each record holder, as of the Effective Time, of an
outstanding certificate or certificates which immediately prior to the Effective
Time represented EDNET Shares (the "Certificates"), a letter of transmittal and
instructions for use in effecting the surrender of the Certificates for exchange
therefor. Upon surrender to the Exchange Agent of a Certificate, together with
such letter of transmittal duly executed, the holder of such Certificate shall
be entitled to receive in exchange therefor that number of shares of VDAT Common
Stock which such holder has the right to receive
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under Section 2.1(a) (and any amount of cash payable in lieu of fractional
shares) and such Certificate shall forthwith be canceled. If any such shares are
to be issued to a person other than the person in whose name the Certificate
surrendered in exchange therefor is registered, it shall be a condition of
exchange that the Certificate so surrendered shall be properly endorsed or
otherwise in proper form for transfer and that the person requesting such
exchange shall pay any transfer or other taxes required by reason of the
exchange to a person other than the registered holder of the Certificate
surrendered or such person shall establish to the satisfaction of the Surviving
Corporation that such tax has been paid or is not applicable.
(c) No dividends or other distributions with respect to the VDAT Common
Stock constituting all or a portion of the consideration payable to the holders
of EDNET Shares shall be paid to the holder of any unsurrendered Certificate
representing EDNET Shares until such Certificate is surrendered as provided for
in this Section 2.4. Subject to the effect of applicable laws, following such
surrender, there shall be paid, without interest, to the record holder of the
certificates representing VDAT Common Stock (i) at the time of such surrender,
the amount of dividends or other distributions with a record date after the
Effective Time payable prior to or on the date of such surrender with respect to
such whole shares of VDAT Common Stock and not paid, and the amount of cash
payable in lieu of any fractional shares, less the amount of any withholding
taxes which may be required thereon under any provision of federal, state, local
or foreign tax law, and (ii) at the appropriate payment date, the amount of
dividends or other distributions with a record date after the Effective Time,
but prior to the date of surrender and a payment date subsequent to the date of
surrender payable with respect to such whole shares of VDAT Common Stock, less
the amount of any withholding taxes which may be required thereon under any
provision of federal, state, local or foreign tax Law. VDAT shall make available
to the Exchange Agent cash for these purposes.
(d) Any portion of the VDAT Common Stock made available to the Exchange
Agent pursuant to Section 2.4(a) that remains unclaimed by the holders of EDNET
Shares twelve (12) months after the Effective Date shall be returned to VDAT,
upon demand, and any such holder who has not exchanged his, her or its EDNET
Shares in accordance with this Section 2.4 prior to that time shall thereafter
look only to VDAT for his, her or its claim for VDAT Common Stock and VDAT
Preferred Shares, (as the case may be), any cash in lieu of fractional shares
and certain dividends or other distributions. Neither VDAT nor SUB shall be
liable to any holder of EDNET Shares with respect to any VDAT Common Stock and
VDAT Preferred Shares (or cash in lieu of fractional shares) delivered to a
public official pursuant to any applicable abandoned property, escheat or
similar law.
(e) If any Certificate representing EDNET Shares shall have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and, if required by
VDAT, the posting by such person of a bond in such reasonable amount as VDAT may
direct as indemnity against any claim that may be made against it with respect
to such Certificate, the Exchange Agent shall issue in exchange for such lost,
stolen or destroyed Certificate the consideration payable under Section 2.1(a)
and, if applicable, any unpaid
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dividends and distributions on shares of VDAT Stock deliverable with respect
thereof and any cash in lieu of fractional shares, in each case pursuant to this
Agreement.
Section 2.5 FRACTIONAL SHARES. Notwithstanding any other provision of
this Agreement, each holder of EDNET Shares who upon surrender of Certificates
therefor would be entitled to receive a fraction of a share of VDAT Common Stock
shall receive, in lieu of such fractional share, cash in an amount equal to such
fraction multiplied by the initial fair market value of VDAT Common Stock. For
purposes of this Agreement, initial market value means the average of the
closing bid and ask price of VDAT Common Stock for the five trading days ending
three trading days immediately preceding the Closing.
Section 2.6 TRANSFERS. From and after the Effective Time, there shall
be no transfers on the stock transfer books of EDNET or the Surviving
Corporation of EDNET Shares. If, after the Effective Time, Certificates are
presented to the Surviving Corporation, they shall be canceled and exchanged as
provided in this Article II.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF VDAT AND SUB
VDAT and SUB jointly and severally represent and warrant to EDNET as
follows:
Section 3.1 ORGANIZATION. Each of VDAT and SUB is a corporation duly
organized, validly existing and in good standing under the laws of its
respective State of Incorporation. VDAT owns directly all of the outstanding
capital stock of SUB. Each of VDAT and SUB has all requisite corporate power and
authority to own, lease and operate its properties and to carry on its business
as now being conducted. Except as set forth in Schedule 3.1, each of VDAT and
SUB is duly qualified or licensed and in good standing to do business in each
jurisdiction in which the property owned, leased or operated by it or the nature
of the business conducted by it makes such qualifications or licenses necessary,
as indicated on Schedule 3.1 except in such jurisdictions where the failure to
be so duly qualified or licensed and in good standing would not individually or
in the aggregate have a material adverse effect on the business, operations,
assets, prospects, financial condition or results of operations of VDAT and
would not delay or prevent the consummation of the transactions contemplated
hereby (an "VDAT Material Adverse Effect"). VDAT previously has delivered to
EDNET accurate and complete copies of its Articles of Incorporation and Bylaws,
and SUB's Certificate of Incorporation and Bylaws, each as currently in effect.
Section 3.2 CAPITALIZATION. (a) The authorized capital stock of VDAT
consists of 50,000,000 shares of VDAT Common Stock and 5,000,000 shares of VDAT
Preferred Shares. As of the date hereof, there are 12,501,181 shares of VDAT
Common Stock issued and outstanding and no shares held in treasury; and no
shares of VDAT Preferred Shares outstanding. As of the date hereof, there were
outstanding under the VDAT Stock Option Plans, or otherwise, VDAT Stock Options
and outstanding VDAT warrants entitling the holders thereof to purchase, in the
aggregate, up to 12,507,367 shares of VDAT common stock. All shares of VDAT
Common Stock to be issued at the Effective Time shall be, when issued, duly
authorized and validly issued,
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fully paid, and nonassessable and subject to the terms of this Agreement free
from liens, charges, claims and encumbrances.
(b) The authorized capital stock of SUB consists of one hundred (100)
shares of common stock, $.0001 par value, of which one hundred (100) are issued
and outstanding and are validly issued, fully paid and nonassessable. As of the
date hereof, there are no outstanding Sub Stock Options entitling the holders
thereof to purchase SUB Shares.
Section 3.3 AUTHORITY. Each of VDAT and SUB has full corporate power
and authority to execute and deliver this Agreement and, subject to the
requisite approval of the shareholders of VDAT, to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and validly
authorized and approved by the Boards of Directors of VDAT and SUB and by VDAT
as the sole shareholder of SUB, and, except for the requisite approval by the
shareholders of VDAT, no other corporate proceedings on the part of VDAT or SUB
are necessary to authorize this Agreement or to consummate the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by each of VDAT and SUB and, assuming this Agreement constitutes a
legal, valid and binding agreement of EDNET and the EDNET Shareholders,
constitutes a legal, valid and binding agreement of VDAT and SUB, as the case
may be, enforceable against each of them in accordance with its terms, except as
the enforceability may be affected by applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and the possible unavailability of certain equitable
remedies, including the remedy of specific performance.
Section 3.4 NO VIOLATIONS: CONSENTS AND APPROVALS. Except as set forth
on Schedule 3.4, (a) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby nor compliance by VDAT
and SUB with any of the provisions hereof conflicts with, violates or results in
any breach of (i) subject to obtaining the requisite approval of VDAT's
shareholders, any provision of the Articles of Incorporation or Bylaws of either
of VDAT or SUB, (ii) any contract, agreement, instrument or understanding to
which VDAT or SUB is a party or by which VDAT, SUB or any of their respective
assets or properties is bound, or (iii) subject to the requisite approval of
VDAT's shareholders any law, judgment, decree, order, statute, rule or
regulation of any jurisdiction or governmental authority (a "Law") applicable to
VDAT or SUB or any of their respective assets or properties, excluding from the
foregoing clauses (ii) and (iii) conflicts, violations or breaches which, either
individually or in the aggregate, would not have an VDAT Material Adverse Effect
or materially impair VDAT's or SUB's ability to consummate the transactions
contemplated hereby or for which VDAT or SUB have received or, prior to the
Merger, shall have received appropriate consents or waivers.
(b) No filing or registration with, notification to, or authorization,
consent or approval of, any governmental entity is required by VDAT or SUB in
connection with the execution and delivery of the Agreement or the consummation
by VDAT or SUB of the transactions contemplated hereby, except (i) in
connection, or in compliance, with the provisions of the Securities Act of 1933,
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as amended (the "Securities Act"), and the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), (ii) the filing of the Certificate of Merger with
the Secretary of State of the States of Florida and Delaware, (iii) filings
with, and approval of, the NASDAQ in connection with obligations of VDAT
hereunder, and (iv) such consents, approvals, orders, authorizations,
registrations, declarations and filings, the failure of which to be obtained or
made would not, individually or in the aggregate, have an VDAT Material Adverse
Effect, or materially impair the ability of VDAT or SUB to perform its
obligations hereunder or prevent the consummation of any of the transactions
contemplated hereby.
Section 3.5 SEC DOCUMENTS: VDAT FINANCIAL STATEMENTS. (a) VDAT has
filed with the Securities and Exchange Commission ("SEC") all documents required
to be filed under the Securities Act and the Exchange Act since the effective
date of its initial public offering (the "VDAT SEC Documents"). As of their
respective dates, the VDAT SEC Documents complied in all respects with the
requirements of the Securities Act and the Exchange Act, as the case may be, and
none of the VDAT SEC Documents contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.
(b) As of their respective dates, the financial statements of VDAT
included in the VDAT SEC Documents were prepared in accordance with generally
accepted accounting principles applied on a consistent basis during the periods
involved (except as may be indicated therein or in the notes thereto) and
present fairly the consolidated financial position of VDAT as at the dates
thereof and the consolidated results of its operations and statements of
cash-flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments and to any other adjustments
described therein). VDAT's balance sheet included in its Form 10-QSB for the
quarter ended March 31, 2001, shall be referred to as the VDAT Interim Balance
Sheet.
(c) VDAT has no liability or obligation of any kind (whether contingent
or otherwise and whether due or to become due) except (i) as set forth on
Schedule 3.5, (ii) as set forth on the VDAT Interim Balance Sheet, or (iii) as
incurred in the ordinary course of business, consistent with past practice since
the date of the VDAT Interim Balance Sheet.
Section 3.6 ABSENCE OF CERTAIN CHANGES. Since the date of the VDAT
Interim Balance Sheet, VDAT has been operated only in the ordinary course,
consistent with past practice, and there has not been any adverse change, or any
event, fact or circumstance which might reasonably be expected to result in an
adverse change, in either event that would have a VDAT Material Adverse Effect.
Without limiting the generality of the foregoing, except as set forth on
Schedule 3.6, since October 1, 2000, there has not been with respect to VDAT
any:
(a) sale or disposition of any material asset other than inventory in
the ordinary course;
(b) payment of any dividend, distribution or other payment to any
shareholder of VDAT or to any relative of any such shareholder other than
payments of salary and expense reimbursements
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made in the ordinary course of business, consistent with past practice, for
employment services actually rendered or expenses actually incurred;
(c) incurrence or commitment to incur any liability individually or in
the aggregate material to VDAT, except such liabilities under VDAT's existing
credit facilities and liabilities incurred in connection with the Merger;
(d) waiver, release, cancellation or compromise of any indebtedness
owed to VDAT or claims or rights against others, exceeding $50,000 in the
aggregate;
(e) any change in any accounting method, principle or practice except
as required or permitted by generally accepted accounting principles; or
(f) unusual or novel method of transacting business engaged in by VDAT
or any change in VDAT's accounting procedures or practices or its financial or
equity structure.
Section 3.7 PROXY STATEMENT/PROSPECTUS REGISTRATION STATEMENT. None of
the information regarding VDAT and SUB to be supplied by VDAT and SUB for
inclusion or incorporation by reference in (i) the registration statement on
Form S-4 (as it may be amended or supplemented from time to time, the
"Registration Statement") relating to VDAT Common Stock to be issued in
connection with the Merger or (ii) the proxy statement to be distributed in
connection with the shareholders meeting of EDNET contemplated by Section 5.5
(as it may be amended or supplemented from time to time, the "Proxy Statement"
and together with the prospectus to be included in the Registration Statement,
the "Proxy Statement/Prospectus") will, in the case of the Registration
Statement, at the time it becomes effective and at the Effective Time, and, in
the case of the Proxy Statement, at the time of its mailing to shareholders of
EDNET and at the time of their respective shareholders' meetings, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein not
misleading in light of the circumstances when made. If at any time prior to the
Effective Time any event with respect to VDAT or SUB shall occur which is
required to be described in the Proxy Statement or Registration Statement, such
event shall be so described, and an amendment or supplement shall be promptly
filed with the SEC and, as required by law, disseminated to the shareholders of
VDAT and EDNET. The Proxy Statement and the Registration Statement will (with
respect to VDAT) comply as to form in all material respects with the provisions
of the Securities Act and the Exchange Act.
Section 3.8 BROKER'S FEES. Except as set forth on Schedule 3.8, neither
VDAT nor SUB nor any of VDAT's affiliates or their respective officers,
directors or agents has employed any broker, finder or financial advisor or
incurred any liability for any broker's fees, commissions, or financial advisory
or finder's fees in connection with any of the transactions contemplated by this
Agreement.
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Section 3.9 COMPLIANCE WITH LAWS. Except as set forth on Schedule 3.9,
VDAT is not or has not conducted its business in violation of any Law, including
without limitation, any law pertaining to environmental protection, occupational
health or safety, or employment practices except the violation of which would
not have an VDAT Material Adverse Effect.
Section 3.10 NO LITIGATION. Except as set forth in the VDAT SEC
Documents or on Schedule 3.10, there is no claim, litigation, investigation or
proceeding by any person or governmental authority pending or, to VDAT's
knowledge threatened, against VDAT. There are no pending or, to VDAT's
knowledge, threatened controversies or disputes with, or grievances or claims
by, any employees or former employees of VDAT or any of its respective
predecessors of any nature whatsoever, including, without limitation, any
controversies, disputes, grievances or claims with respect to their employment,
compensation, benefits or working conditions, except for such litigation which
would not have a VDAT Material Adverse Effect.
Section 3.11 ABSENCE OF CERTAIN BUSINESS PRACTICES. Neither VDAT nor
any director, officer, employee or agent of the foregoing, nor any other person
acting on its behalf, directly or indirectly, has to VDAT's knowledge given or
agreed to give any gift or similar benefit to any customer, supplier,
governmental employee or other person which (i) might subject VDAT to any damage
or penalty in any civil, criminal or governmental litigation or proceeding, (ii)
if not given in the past, might have had a VDAT Material Adverse Effect, or
(iii) if not continued in the future, might have a VDAT Material Adverse Effect
or which might subject VDAT to suit or penalty in any private or governmental
litigation or proceeding.
Section 3.12 KNOWLEDGE. The term "to VDAT's knowledge" shall mean the
actual knowledge of each director and executive officer of VDAT.
Section 3.13 NO UNDISCLOSED INFORMATION. No provision of this Article
III or any Schedule or any document or agreement furnished by VDAT contains any
untrue statement of a material fact, or omits to state a material fact necessary
in order to make the statement contained herein, in light of the circumstances
under which such statements are made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF EDNET
EDNET represents and warrants to VDAT and SUB as follows:
Section 4.1 ORGANIZATION. (a) EDNET is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted. EDNET is
duly qualified or licensed and in good standing to do business in each
jurisdiction in which the property owned, leased or operated by it or the nature
of the business conducted by it makes such qualifications or licenses necessary,
as indicated on Schedule 4.1, except
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in such jurisdictions where the failure to be so duly qualified or licensed and
in good standing would not individually or in the aggregate have a material
adverse effect on the business, operations, assets, prospects, financial
condition or results of operations of EDNET and would not delay or prevent the
consummation of the transactions contemplated hereby (a "EDNET Material Adverse
Effect").
(b) EDNET previously has delivered to VDAT accurate and complete copies
of EDNET's Certificate of Incorporation and Bylaws, each as currently in effect.
Section 4.2 CAPITALIZATION. (a) The authorized capital stock of EDNET
consists of 50,000,000 shares of EDNET common stock and 5,000,000 shares of
EDNET preferred shares. As of the date hereof, there are 23,956,980 shares of
EDNET common stock issued and outstanding and no shares held in treasury; and no
shares of EDNET preferred stock outstanding. As of the date hereof, there were
outstanding under the EDNET Stock Option Plans, all of which are listed on
Schedule 4.2, EDNET Stock Options entitling the holders thereof to purchase, in
the aggregate, up to 4,078,214 EDNET Shares. As of the date hereof, there are
outstanding, all of which are listed on Schedule 4.2, EDNET warrants entitling
the holders thereof to purchase in the aggregate, up to 1,967,158 EDNET shares.
Except as set forth on Schedule 4.2, at the Effective Time, there will not be
any existing options, warrants, calls, subscriptions, or other rights or other
agreements or commitments obligating EDNET to issue, transfer or sell any shares
of capital stock of EDNET or any other securities convertible into or evidencing
the right to subscribe for any such shares. All issued and outstanding EDNET
Shares are, and all EDNET Shares issued and outstanding at the Effective Time
shall be, duly authorized and validly issued, fully paid and non-assessable and
subject to the terms of this Agreement free from all liens, charges, claims and
encumbrances.
(b) EDNET has two subsidiaries.
(i) EDNET has a wholly-owned subsidiary organized under the
law of the State of California, Entertainment Digital Network, Inc. ("EDNET
California"). EDNET California is in good standing in the State of California.
(ii) EDNET has a second wholly-owned subsidiary, also
organized under the law of the State of California, Internet Business Solutions,
Inc. ("IBS"). IBS conducts no business and sold substantially all of its assets
to a third party in 1998.
Section 4.3 AUTHORITY. EDNET has full corporate power and authority to
execute and deliver this Agreement and, subject to the requisite approval of the
Merger and the adoption of this Agreement by EDNET's shareholders, to consummate
the transactions contemplated hereby. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have been
duly and validly authorized by EDNET's Board of Directors and, except for the
requisite approval of the Merger and the adoption of this Agreement by EDNET's
shareholders, no other corporate proceedings on the part of EDNET are necessary
to authorize this Agreement or to consummate the transactions contemplated
hereby. EDNET's Board of Directors has determined that the transactions
contemplated by this Agreement, including the Merger, are in the best interests
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of EDNET and its shareholders and, except as provided in Section 5.2 below, have
determined to recommend to such shareholders that they vote in favor of this
Agreement and the consummation of the transactions contemplated hereby,
including the Merger. This Agreement has been duly and validly executed and
delivered by EDNET and the EDNET Shareholders, and assuming this Agreement
constitutes a legal, valid and binding agreement of VDAT and SUB, constitutes a
legal, valid and binding agreement of EDNET and the EDNET Shareholders, as the
case may be, enforceable against each of them in accordance with its terms,
except as the enforceability may be affected by applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and the possible unavailability of
certain equitable remedies, including the remedy of specific performance.
Section 4.4 NO VIOLATIONS; CONSENTS AND APPROVALS. Except as set forth
on Schedule 4.4, (a) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby nor compliance by EDNET
and the EDNET Shareholders with any of the provisions hereof conflicts with,
violates or results in any breach of (i) subject to obtaining the requisite
approval of EDNET's shareholders, any provision of the Certificate of
Incorporation or Bylaws of EDNET, (ii) any contract, agreement, instrument or
understanding to which EDNET, or any EDNET Shareholder is a party, or by which
EDNET, any EDNET Shareholder or any of their respective assets or properties is
bound, or (iii) subject to the requisite approval of EDNET's shareholders, any
Law applicable to EDNET, any EDNET Shareholder or any of their respective assets
or properties, excluding from the foregoing clauses (ii) and (iii) conflicts,
violations or breaches which, either individually or in the aggregate, would not
have a EDNET Material Adverse Effect or materially impair EDNET's or EDNET
Shareholder's ability to consummate the transactions contemplated hereby or for
which EDNET or EDNET Shareholders have received or, prior to the Merger, shall
have received appropriate consents or waivers.
(b) No filing or registration with, notification to, or authorization,
consent or approval of, any governmental entity is required by EDNET in
connection with the execution and delivery of the Agreement or the consummation
by EDNET of the transactions contemplated hereby, except (i) the filing of the
appropriate merger documents with the Secretary of State of the States of
Florida and Delaware and (ii) such consents, approvals, orders, authorizations,
registrations, declarations and filings, the failure of which to be obtained or
made would not, individually or in the aggregate, have a EDNET Material Adverse
Effect, or materially impair the ability of EDNET to perform its obligations
hereunder or prevent the consummation of any of the transactions contemplated
hereby.
Section 4.5 SEC DOCUMENTS: EDNET FINANCIAL STATEMENTS. (a) EDNET has
filed with the SEC all documents required to be filed under the Securities Act
and the Exchange Act since the effective date of its initial public offering
(the "EDNET SEC Documents"). As of their respective dates, the EDNET SEC
Documents complied in all respects with the requirements of the Securities Act
and the Exchange Act, as the case may be, and none of the EDNET SEC Documents
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
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(b) As of their respective dates, the financial statements of EDNET
included in the EDNET SEC Documents were prepared in accordance with generally
accepted accounting principles applied on a consistent basis during the periods
involved (except as may be indicated therein or in the notes thereto) and
present fairly the consolidated financial position of EDNET as at the dates
thereof and the consolidated results of its operations and statements of
cash-flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments and to any other adjustments
described therein). EDNET's balance sheet included in its Form 10-QSB for the
quarter ended March 31, 2001, shall be referred to as the EDNET Interim Balance
Sheet.
(c) EDNET has no liability or obligation of any kind (whether
contingent or otherwise and whether due or to become due) except (i) as set
forth on Schedule 4.5, (ii) as set forth on the EDNET Interim Balance Sheet, or
(iii) as incurred in the ordinary course of business, consistent with past
practice since the date of the EDNET Interim Balance Sheet.
Section 4.6 ABSENCE OF CERTAIN CHANGES. Since the date of the EDNET
Interim Balance Sheet, EDNET has been operated only in the ordinary course,
consistent with past practice, and there has not been any adverse change, or any
event, fact or circumstance which might reasonably be expected to result in an
adverse change, in either event that would have an EDNET Material Adverse
Effect. Without limiting the generality of the foregoing, except as set forth on
Schedule 4.6, since January 1, 2001, there has not been with respect to EDNET
any:
(a) sale or disposition of any material asset other than inventory in
the ordinary course;
(b) payment of any dividend, distribution or other payment to any
Shareholder of EDNET or to any relative of any such Shareholder other than
payments of salary and expense reimbursements made in the ordinary course of
business, consistent with past practice, for employment services actually
rendered or expenses actually incurred;
(c) incurrence or commitment to incur any liability individually or in
the aggregate material to EDNET, except such liabilities under EDNET's existing
credit facilities and liabilities incurred in connection with the Merger;
(d) waiver, release, cancellation or compromise of any indebtedness
owed to EDNET or claims or rights against others, exceeding $50,000 in the
aggregate;
(e) any change in any accounting method, principle or practice except
as required or permitted by generally accepted accounting principles; or
(f) unusual or novel method of transacting business engaged in by EDNET
or any change in EDNET's accounting procedures or practices or its financial or
equity structure.
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Section 4.7 PROXY STATEMENT PROSPECTUS; REGISTRATION STATEMENT. None of
the information regarding EDNET to be supplied by EDNET for inclusion or
incorporation by reference in the Registration Statement or the Proxy Statement
will, in the case of the Registration Statement at the time it becomes effective
and at the Effective Time, and in the case of the Proxy Statement, at the time
it is first mailed to shareholders of EDNET and at the time of their respective
shareholders meetings, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein not misleading in light of the circumstances when
made. If at any time prior to the Effective Time any event with respect to EDNET
shall occur which is required to be described in the Proxy Statement or
Registration Statement, such event shall be so described, and an amendment or
supplement shall be promptly filed with the SEC and, as required by law,
disseminated to the shareholders of EDNET. The Proxy Statement and the
Registration Statement will (with respect to EDNET) comply as to form in all
material respects with the provisions of the Securities Act and the Exchange
Act.
Section 4.8 STATE ANTITAKEOVER STATUTES. The EDNET Board of Directors
has approved this Agreement and the transactions contemplated hereby and such
approval constitutes approval of the Merger and the other transactions
contemplated hereby by the EDNET Board of Directors as required by the DGCL. No
"business combination," "moratorium," "control share," "fair price," "interested
shareholder," affiliated transactions" or other state antitakeover statute or
regulation (i) prohibits or restricts EDNET's ability to perform its obligations
under this Agreement or to consummate the Merger or to the other transactions
contemplated hereby or thereby, (ii) would have the effect of invalidating or
voiding this Agreement or the voting agreement or any provision hereof, or (iii)
would subject VDAT or SUB to any material impediment or condition in connection
with the exercise of any of their respective rights under this Agreement.
Section 4.9 BROKER'S FEES. Neither EDNET nor any of its affiliates or
their respective officers, directors or agents has employed any broker, finder
or financial advisor or incurred any liability for any broker's fees,
commissions, financial advisory or finder's fees in connection with any of the
transactions contemplated by this Agreement.
Section 4.10 COMPLIANCE WITH LAWS. EDNET is not or has not conducted
its business in violation of any law, including without limitation, any law
pertaining to environmental protection, occupational health or safety, or
employment practices except the violation of which would not have an EDNET
Material Adverse Effect.
Section 4.11 NO LITIGATION. There is no claim, litigation,
investigation or proceeding by any person or governmental authority pending or,
to EDNET's knowledge threatened, against EDNET. There are no pending or, to
EDNET's knowledge, threatened controversies or disputes with, or grievances or
claims by, any employees or former employees of EDNET or any of its respective
predecessors of any nature whatsoever, including, without limitation, any
controversies, disputes, grievances or claims with respect to their employment,
compensation, benefits or working conditions, except for such litigation which
would not have an EDNET Material Adverse Effect.
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Section 4.12 EMPLOYEE BENEFITS. All employee welfare benefit plans as
defined in Section 3(1) of the Employee Retirement Income Security Act of 1974
("ERISA"), employee pension benefit plans as defined in Section 3(2) of ERISA,
and all other employee benefit programs or arrangements of any type, written or
unwritten (collectively, the "Plans") maintained by EDNET or to which EDNET
contributes are listed on Schedule 4.16. In addition, Schedule 4.16 separately
sets forth any Plans which EDNET, or any affiliate or predecessor of EDNET,
maintained or contributed to within the six years preceding the date hereof.
(a) The Plans comply, with all applicable provisions of all Laws,
including, without limitation, the Code and ERISA, and have so complied during
all prior periods during which any such provisions were applicable. Without
limiting the foregoing, all of the Plans, and any related trust, intended to
meet the requirements for tax-favored treatment under the Code (including,
without limitation, Sections 401 and 501 and Subchapter B of the Chapter 1 of
the Code) meets and for all prior periods has met, such requirements in all
material respects.
(b) EDNET and any other party involved in the administration of any of
the Plans (i) has complied in all material respects with the provisions of
ERISA, the Code or other Laws, applicable to such party, whether as an employer,
plan sponsor, plan administrator, or fiduciary of any of the Plans or otherwise,
(including without limitation the provisions of ERISA and the Code concerning
prohibited transactions), and (ii) has administered the Plans in accordance with
the terms. EDNET has made all contributions required of it by any Law
(including, without limitation, ERISA) or contract under any of the Plans and no
unfunded liability exists with respect to any of the Plans.
(c) EDNET has no responsibility or liability, contingent or otherwise,
with respect to any Plans or any employee benefits other than under the Plans
listed on Schedule 4.16. EDNET has the right to amend or terminate, without the
consent of any other person, any of the Plans, except as prohibited by law and
any applicable collective bargaining agreement. Neither EDNET, nor any affiliate
or predecessor of EDNET, maintains or has ever maintained or been obligated to
contribute to (i) any defined benefit pension plan (as such term is defined in
Section 3(35) of ERISA), (ii) any multiemployer plan (as such term is defined in
Section 3(37) of ERISA), (iii) any severance plan or policy, or (iv) any
arrangement providing medical or other welfare benefits to retirees or other
former employees or their beneficiaries, except as required under part 6 of
Subtitle B of Title I of ERISA or Section 4980B(f) of the Code (hereinafter
collectively referred to as "COBRA").
(d) There are no actions, suits or claims pending (other than routine
claims for benefits) or, to EDNET's knowledge, any actions, suits, or claims
(other than routine claims for benefits) which could reasonably be expected to
be asserted, against any of the Plans, or the assets thereof, or against EDNET
or any other party with respect to any of the Plans.
Section 4.13 TAXES. (a) EDNET has duly filed with the appropriate
federal, state, local and foreign taxing authorities all Tax Returns (as defined
below) required to be filed by or with respect to EDNET on or before the date
hereof. EDNET has included its federal income Tax Returns for all periods ended
on or before December 31, 1998. All such Tax Returns are true, correct and
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complete in all material respects as of the time of filing. EDNET, with respect
to the federal income Tax Returns, and, with respect to any other Tax Returns,
has paid in full on a timely basis all Taxes (as defined below) due on such Tax
Returns or such Taxes that are otherwise due, except to the extent such Tax is
being contested in good faith through appropriate proceedings and for contested
Taxes only which adequate reserves have been established on the EDNET Interim
Balance Sheet. Except as set forth on Schedule 4.17, the balance for accrued
Taxes on the EDNET Interim Balance Sheet for the payment of accrued but unpaid
Taxes through the date thereof is correct and the amount of EDNET's liability
for unpaid Taxes shall not exceed such balance for accrued but unpaid Taxes of
EDNET. The balance of accrued Taxes have been determined in accordance with
generally accepted accounting principles, applied on a consistent basis. All
monies which EDNET was required by Law to withhold from employees have been
withheld and either timely paid to the proper governmental authority or set
aside in accounts for such purposes and accrued on the books of EDNET.
(b) EDNET has never been a member of an affiliated group filing
consolidated returns.
(c) (i) EDNET has not received any notice of a deficiency or assessment
with respect to Taxes of EDNET from any taxing authority which has not been
fully paid or finally settled, except to the extent any such deficiency or
assessment is being contested in good faith through appropriate proceedings and
for which adequate reserves have been established on the EDNET Interim Balance
Sheet; (ii) there are no ongoing audits or examinations of any Tax Return
relating to EDNET and no notice (oral or written) of audit or examination of any
such Tax Return has been received by EDNET; (iii) In the last three years, the
federal income Tax Returns of EDNET have not been audited by the Internal
Revenue Service; and (iv) To EDNET's knowledge, no issue has been raised (either
in writing or verbally, formally or informally) on audit or in any other
proceeding (and is currently pending) with respect to Taxes of EDNET by any
taxing authority which, if resolved against EDNET, would have a EDNET Material
Adverse Effect. EDNET has disclosed on its federal income tax returns all
positions taken therein that, EDNET believes could give rise to a substantial
understatement penalty within the meaning of Code Section 6662.
(d) EDNET is not (nor has it ever been) a party to any tax sharing
agreement and has not assumed the liability for taxes of any other person under
law or contract.
(e) EDNET (i) has not filed a consent pursuant to Code Section 341(f)
nor agreed to have Code Section 341(f)(2) apply to any disposition of a
subsection (f) asset (as such term is defined in Code Section 341(f)) owned by
EDNET; (ii) has not agreed, or is not required, to make any adjustment under
Code Section 481(a) by reason of a change in accounting method or otherwise
initiated by EDNET that will affect the liability of EDNET for Taxes; (iii) has
not made an election, or is required, to treat any asset of EDNET as owned by
another person pursuant to the provisions of former Code Section 168(f)(8); (iv)
is not now or has ever been a party to any agreement, contract, arrangement, or
plan that would result, separately or in the aggregate, in the payment of any
"excess parachute payments" within the meaning of Code Section 280G; (v) has not
participated in an international boycott as defined in Code Section 999; (vi) is
not now or has ever been a "foreign
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person" within the meaning of Code Section 1445(b)(2); (vii) is not now or has
ever been a United States real property holding corporation within the meaning
of Code Section 897(c)(1)(A)(ii); or (viii) has not made any of the foregoing
elections or is required to apply any of the foregoing rules under any
comparable state or local tax provision.
(f) EDNET is not required to report or pay any additional Taxes from
any joint venture, partnership or other arrangement or contract limited
liability company that could be treated as a partnership for federal income tax
purposes.
(g) For purposes of this Section 4.17, the following terms shall have
the meaning given to them below:
(i) "Tax" means any of the Taxes, and "Taxes" means, with
respect to EDNET, (i) all income taxes (including any tax on or based upon net
income, or gross income, or income as specially defined, or earnings, or
profits, or selected items of income, earnings or profits) and all gross
receipts, estimated, sales, use, ad valorem, transfer, franchise, license,
withholding, payroll, employment, excise, severance, stamp, occupation, premium,
property, windfall profits, environmental (including taxes under Code Section
59A), alternative, add-on minimum, custom duties, capital stock, social security
(or similar), unemployment, disability, or other taxes, fees assessments, or
charges of any kind whatsoever, together with any interest, penalty, or addition
thereto, whether disputed or not, imposed by any taxing authority, and (ii) any
liability for payment of any amount of the Tax described in the immediately
preceding clause (i) as a result of being a "transferee" (within the meaning of
Code Section 6901 or any other applicable law) of another person or successor,
by contract, or otherwise, or a member of an affiliated, consolidated, or
combined group.
(ii) "Tax Return" means any return, declaration, report, claim
or refund, or information return or statement or other document (including any
related or supporting information) filed or required to be filed with any
appropriate federal, state, local and foreign governmental entity or authority
(individually or collectively, "taxing authority") or other authority in
connection with the determination, assessment or collection of any Tax paid or
payable by the Group or the administration of any Laws, regulations, or
administrative requirements relating to any such Tax.
Section 4.14 ABSENCE OF CERTAIN BUSINESS PRACTICES. Neither EDNET nor
any director, officer, employee or agent of the foregoing, nor any other person
acting on its behalf, directly or indirectly, has to EDNET's knowledge given or
agreed to give any gift or similar benefit to any customer, supplier,
governmental employee or other person which (i) might subject EDNET to any
damage or penalty in any civil, criminal or governmental litigation or
proceeding, (ii) if not given in the past, might have had a EDNET Material
Adverse Effect, or (iii) if not continued in the future, might have a EDNET
Material Adverse Effect or which might subject EDNET to suit or penalty in any
private or governmental litigation or proceeding.
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Section 4.15 INTELLECTUAL PROPERTY. (a) Schedule 4.15(a) sets forth a
correct and complete list of (i) all U.S. and foreign trademarks, patents,
service marks, trade names, copyrights, mask works and designs which are
pending, applied for, granted, or registered in any country or jurisdiction of
the world and are owned by EDNET and used in connection with its business; (ii)
all unregistered trademarks, patents, service marks, and trade names which are
owned by EDNET and used in connection with its business; and (iii) all licenses,
contracts, permissions and other agreements relating to the business to which
EDNET is a party relating in any way to rights in any of the foregoing. Except
as set forth on Schedule 4.15(a), title to all registered intellectual property
is recorded on records in the name of EDNET and, to the extent applicable, all
affidavits of continued use and incontestability in respect of such registered
intellectual property have been timely filed.
(b) Except as disclosed and set forth on Schedule 4.15(b), (i) EDNET
owns or possesses licenses or other valid rights to use, and upon consummation
of the transactions contemplated by this Agreement, the Surviving Corporation
shall own or possess licenses or other valid rights to use (without the making
of any payment to others or the obligation to grant rights to others in
exchange), all intellectual property necessary to the conduct of the business of
EDNET as currently conducted, including, without limitation, all releases
required in connection with quotes, testimonials or likenesses utilized in
editorial or promotional material; (ii) EDNET's right title and interest in such
intellectual property is not being opposed by any claim or demand or in any
proceeding, action, litigation or order to which EDNET or any person or entity
who has granted a license or other right to use intellectual property to EDNET
or who has been granted a license or other right to use intellectual property by
EDNET, is a party or subject, nor to the knowledge of EDNET is any such claim,
demand, proceeding, action, litigation, or court order threatened; and (iii) the
conduct of the business of EDNET as currently conducted does not materially
infringe or conflict with any intellectual property of others.
Section 4.16 REQUIRED VOTE OF EDNET SHAREHOLDERS. The affirmative vote
of the holders of a majority of the outstanding EDNET Shares is required to
approve the Merger. No other vote of the shareholders of EDNET is required by
Law, the Articles of Incorporation or Bylaws of EDNET or otherwise in order for
EDNET to consummate the Merger and the transactions contemplated hereby.
Section 4.17 KNOWLEDGE. The term "to EDNET's knowledge" shall mean the
actual knowledge of each director and officer of EDNET.
Section 4.18 NO UNDISCLOSED INFORMATION. No provision of this Article
IV or any Schedule or any document or agreement furnished by EDNET or the EDNET
Shareholders contains any untrue statement of a material fact, or omits to state
a material fact necessary in order to make the statement contained herein, in
light of the circumstances under which such statements are made, not misleading.
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ARTICLE V
COVENANTS
Section 5.1 CONDUCT OF BUSINESS OF EDNET. Except as contemplated by
this Agreement or as expressly agreed to in writing by the other party, during
the period from the date of this Agreement to the Effective Time, EDNET will
conduct its operations substantially as presently operated and only in the
ordinary course of business, in a normal manner consistent with past practices
and will use commercially reasonable efforts to preserve intact their business
organization, to keep available the services of their officers and employees and
to maintain satisfactory relationships with suppliers, distributors, customers
and others having business relationships with it and will take no action which
would adversely affect its ability to consummate the transactions contemplated
by this Agreement. Without limiting the generality of the foregoing, except as
otherwise expressly provided in this Agreement, prior to the Effective Time
EDNET will not, without the prior written consent VDAT:
(a) amend its Articles of Incorporation or Bylaws;
(b) authorize for issuance, issue, sell, deliver, grant any options
for, or otherwise agree or commit to issue, sell or deliver any shares of its
capital stock or any securities convertible into shares of its capital stock,
other than pursuant to and in accordance with the terms of its stock option
plans;
(c) recapitalize, split, combine or reclassify any shares of its
capital stock; declare, set aside or pay any dividend or other distribution
(whether in cash, stock or property or any combination thereof) in respect of
its capital stock; or purchase, redeem or otherwise acquire any shares of its
own capital stock;
(d) (i) create, incur, assume, maintain or permit to exist any
long-term debt or any short-term debt for borrowed money other than under
existing lines of credit, relating to purchase money security interests or
obligations as a lessee under leases recorded as capital leases, each as
incurred in the ordinary course of business; (ii) assume, guarantee, endorse or
otherwise become liable or responsible (whether directly, contingently or
otherwise) for the obligations of any other person, except in the ordinary
course of business and consistent with past practices; or (iii) make any loans,
advances or capital contributions to, or investments in, any other person;
(e) (i) increase in any manner the rate of compensation of any of its
directors, officers or other employees, except in the ordinary course of
business and in accordance with its customary past practices or as otherwise may
be contractually required; or (ii) pay or agree to pay any bonus, pension,
retirement allowance, severance or other employee benefit except as required
under currently existing employee benefit plans or in the EDNET SEC Documents;
(f) except as set forth on Schedule 5.1, sell or otherwise dispose of,
or encumber, or agree to sell or otherwise dispose of or encumber, any assets
other than inventory in the ordinary course of business;
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(g) enter into any other agreement, commitment or contract, except
agreements, commitments or contracts for the purchase, sale or lease of goods or
services in the ordinary course of business consistent with past practice;
(h) authorize, recommend, propose or announce an intention to
authorize, recommend or propose, or enter into any agreement in principle or an
agreement with respect to, any (i) plan of liquidation or dissolution, (ii)
acquisition of a material amount of assets or securities, (iii) disposition of a
material amount of assets or securities or (iv) material change in its
capitalization, or enter into a material contract or any amendment or
modification of any material contract or release or relinquish any material
contract right;
(i) engage in any unusual or novel method of transacting business or
change any accounting procedure or practice or its financial structure; or
(j) take any action the taking of which, or omit to take any action the
omission of which, would cause any of the representations and warranties herein
to fail to be true and correct in all respects as of the date of such action or
omission as though made at and as of the date of such action or omission.
Section 5.2 NO SOLICITATION. EDNET agrees that, prior to the Effective
Time, except as provided below it shall not, and shall not authorize or permit
any of its directors, officers, employees, agents or representatives to,
directly or indirectly, solicit, initiate, facilitate or encourage (including by
way of furnishing or disclosing information), or take any other action to
facilitate, any inquiries or the making of any proposal that constitutes, or may
reasonably be expected to lead to any Transaction Proposal (as defined below),
or enter into or maintain or continue discussions or negotiate with any person
or entity in furtherance of such inquiries or to obtain a Transaction Proposal
or agree to or endorse any Transaction Proposal or authorize or permit any of
its officers, directors or employees or any investment banker, financial
advisor, attorney, accountant or other representative retained by it to take any
such action; provided, however, that nothing contained in this Agreement shall
prohibit the EDNET Board of Directors from (i) furnishing information to or
entering into discussions or negotiations with any person or entity that makes
an unsolicited written, bona fide Transaction Proposal which the EDNET Board of
Directors determines in good faith that such action is necessary for the EDNET
Board of Directors to comply with its fiduciary duties to shareholders under
applicable law or (ii) withdrawing, modifying or changing its recommendation
referred to in Section 4.3 if there exists a Transaction Proposal and the EDNET
Board of Directors, based upon the advise of independent legal counsel,
determines in good faith that such action is necessary for the EDNET Board of
Directors to comply with its fiduciary duties to shareholders under applicable
law in connection with such Transaction Proposal. EDNET shall immediately advise
the other parties to this Agreement, orally and in writing, of any inquiries or
proposals relating to an Transaction Proposal known to it, the material terms
and conditions of such inquiry or proposal, and the identity of the person or
entity making such inquiry or proposal. EDNET shall give VDAT and SUB at least
two (2) business days advance notice of any information to be supplied
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to, and at least three (3) days' advance notice of any agreement to be entered
into with any person or entity making such a proposal for a Transaction Proposal
with respect to EDNET. For purposes of this Agreement, "Transaction Proposal"
shall mean any of the following (other than the transactions between EDNET, VDAT
and SUB contemplated by this Agreement) involving EDNET: (i) any merger,
consolidation, share exchange, recapitalization, business combination or other
similar transaction; (ii) any sale, lease, exchange, mortgage, pledge, transfer
or other disposition of twenty percent (20%) or more of the assets of EDNET, in
a single transaction or series of transactions; (iii) any offer for, or the
acquisition (or right to acquire) of "beneficial ownership" by any person,
"group" or entity (as such terms are defined under Section 13(d) of the
Securities Exchange Act of 1934), of twenty percent (20%) or more of the
outstanding shares of capital stock of EDNET or the filing of a registration
statement under the Securities Act in connection therewith; or (iv) any public
announcement by EDNET of a proposal, plan or intention to do any of the
foregoing or any agreement to engage in any of the foregoing.
Section 5.3 ACCESS TO INFORMATION. (a) From the date of this Agreement
until the Effective Time, EDNET will provide VDAT and VDAT will provide EDNET,
and their respective lenders and authorized representatives (including counsel,
environmental and other consultants, accountants and auditors) full access
during normal business hours to all facilities, personnel and operations and to
all books and records of EDNET, VDAT and SUB, will permit the other party to
make such inspections as it may reasonably require (including without limitation
any air, water or soil testing or sampling deemed necessary) and will cause its
officers to furnish the other party with such financial and operating data and
other information with respect to its business and properties as the other party
may from time to time reasonably request.
(b) VDAT and EDNET will hold and will cause their representatives to
hold in confidence, all documents and information furnished in connection with
this Agreement. Other than documents or information (i) available to the public,
(ii) which are or become known by VDAT or EDNET from a source other than EDNET
or VDAT, as the case may be, other than by a breach of a confidentiality
obligation owed to EDNET or VDAT, respectively, or (iii) required by law to be
disclosed.
Section 5.4 REGISTRATION STATEMENT AND PROXY STATEMENT. VDAT shall file
with the SEC as soon as is reasonably practicable after the date hereof the
Proxy Statement/Prospectus and VDAT shall file the Registration Statement in
which the Proxy Statement/Prospectus shall be included. EDNET shall cooperate
with VDAT with regard to such filings. VDAT and EDNET shall use all commercially
reasonable efforts to have the Registration Statement declared effective by the
SEC as promptly as practicable. VDAT shall also take any action required to be
taken under applicable state blue sky or securities laws in connection with the
issuance of the VDAT Common Stock. VDAT and EDNET shall promptly furnish to each
other all information, and take such other actions, as may reasonably be
requested in connection with any action by any of them in connection with the
preceding sentences.
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Section 5.5 SHAREHOLDERS' MEETINGS. Unless the EDNET Board of Directors
shall have taken an action permitted by clause (ii) of Section 5.2 above, EDNET
shall call a meeting of its shareholders to be held as promptly as practicable
(and in any event within 45 days after the Registration Statement is declared
effective) for the purpose of voting upon this Agreement and the Merger. EDNET
shall, through its Board of Directors, recommend to its shareholders approval of
such matters and will coordinate and cooperate with respect to the timing of
such meetings and shall use all commercially reasonable efforts to hold such
meetings on the same day and as soon as practicable after the date hereof.
Unless the EDNET Board of Director shall have taken an action permitted by
clause (ii) of Section 5.2 above, EDNET shall use all commercially reasonable
efforts to solicit from shareholders of such party proxies in favor of such
matters.
Section 5.6 REASONABLE EFFORTS; OTHER ACTIONS. EDNET, VDAT and SUB each
shall use all commercially reasonable efforts promptly to take, or cause to be
taken, all other actions and do, or cause to be done, all other things
necessary, proper or appropriate under applicable Law to consummate and make
effective the transactions contemplated by this Agreement, including, without
limitation, (i) the taking of any actions required to qualify the Merger
treatment as a tax-free reorganization within the meaning of Code Section
368(a)(2)(D), and (ii) the obtaining of all necessary consents, approvals or
waivers under its material contracts.
Section 5.7 PUBLIC ANNOUNCEMENTS. Before issuing any press release or
otherwise making any public statements with respect to the Merger, VDAT, SUB and
EDNET will consult with each other as to its form and substance and shall not
issue any such press release or make any such public statement prior to such
consultation, except as may be required by Law (it being agreed that the parties
hereto are entitled to disclose all requisite information concerning the
transaction and any filings required with the SEC).
Section 5.8 NOTIFICATION OF CERTAIN MATTERS. Each of EDNET and VDAT
shall give prompt notice to the other party of (i) any notice of, or other
communication relating to, a default or event which, with notice of lapse of
time or both, would become a default, received by it subsequent to the date of
this Agreement and prior to the Effective Time, under any contract material to
the financial condition, properties, businesses or results of operations of
EDNET or VDAT, as the case may be, to which it is a party or is subject, (ii)
any notice or other communication from any third party alleging that the consent
of such third party is or may be required in connection with the transactions
contemplated by this Agreement, (iii) any material adverse change in their
respective financial condition, properties, businesses or results of operations
or the occurrence of any event which is reasonably likely to result in any such
change, or (iv) the occurrence or existence of any event which would, or could
with the passage of time or otherwise, make any representation or warranty
contained herein untrue; provided, however, that the delivery of notice pursuant
to this Section 5.8 shall not limit or otherwise affect the remedies available
hereunder to the party receiving such notice. Each party shall use its best
efforts to prevent or promptly remedy the same.
Section 5.9 EXPENSES. Except as otherwise provided herein, VDAT and
SUB, on the one hand, and EDNET, on the other hand, shall bear their respective
expenses incurred in connection
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with the Merger, including, without limitation, the preparation, execution and
performance of this Agreement, the Proxy Statement/Prospectus and the
transactions contemplated hereby, including all fees and expenses of its
representatives, counsel and accountants.
Section 5.10 AFFILIATES. EDNET shall deliver to VDAT a letter
identifying all persons who, as of the date hereof, may be deemed to be
"affiliates" thereof for purposes of Rule 145 under the Securities Act (the
"Affiliates") and shall advise VDAT in writing of any persons who become
Affiliates prior to the Effective Time. EDNET shall cause each person who is so
identified as an Affiliate to deliver to VDAT, no later than the earlier of the
thirtieth (30th) day prior to the Effective Time or the date such person becomes
an Affiliate, a written agreement substantially in the form of Exhibit A hereto.
Section 5.11 STOCK EXCHANGE LISTING. VDAT shall file a listing
application on or before the Closing and thereafter shall use its best efforts
to effect approval to list on the NASDAQ National Market System, the VDAT Common
Stock to be issued pursuant to the Merger.
Section 5.12 STATE ANTITAKEOVER LAWS. If any "fair price" or "control
share acquisition" statute or other similar antitakeover regulation shall become
applicable to the transactions contemplated hereby, VDAT and EDNET and their
respective Board of Directors shall use their reasonable best efforts to grant
such approvals and to take such other actions as are necessary so that the
transactions contemplated hereby may be consummated as promptly as practicable
on the terms contemplated hereby and shall otherwise use their reasonable best
efforts to eliminate the effects of any such statute or regulation on the
transactions contemplated hereby.
Section 5.13 SATISFACTION OF CONDITIONS. EDNET agrees to use its best
efforts to cause each of the conditions set forth in Article VII to VDAT and SUB
proceeding with the Closing to be satisfied on or before the Closing Date. VDAT
and SUB agree to use their respective best efforts to cause each of the
conditions set forth in Article VIII to EDNET proceeding with the Closing to be
satisfied on or before the Closing Date.
ARTICLE VI
CONDITIONS TO THE OBLIGATIONS OF VDAT, SUB AND EDNET
The respective obligations of each party to effect the Merger shall be
subject to the fulfillment at or prior to the closing of each of the following
conditions:
Section 6.1 REGISTRATION STATEMENT. The Registration Statement shall
have become effective in accordance with the provisions of the Securities Act.
No stop order suspending the effectiveness of the Registration Statement shall
have been issued by the SEC and remain in effect. All necessary state securities
or blue sky authorizations shall have been received.
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Section 6.2 SHAREHOLDER APPROVAL. The requisite vote of the
shareholders of EDNET necessary to consummate the transactions contemplated by
this Agreement shall have been obtained.
Section 6.3 CONSENTS AND APPROVALS. All necessary consents and
approvals of any United States or any other governmental authority required for
the consummation of the transactions contemplated by this Agreement shall have
been obtained.
Section 6.4 LISTING. The VDAT Common Stock issued in the Merger shall
have been authorized for listing on the NASDAQ National Market System.
ARTICLE VII
CONDITIONS TO THE OBLIGATIONS OF VDAT AND SUB
The obligation of VDAT and SUB to effect the Merger and to perform
under this Agreement is subject to the fulfillment on or before to the Closing
Date of the following additional conditions, any one or more of which may be
waived, in writing, by VDAT and SUB:
Section 7.1 REPRESENTATIONS ACCURATE. The representations and
warranties of EDNET contained herein shall be true and correct on the date of
this Agreement and at and on the Closing Date as though such representations and
warranties were made at and on such date.
Section 7.2 PERFORMANCE. EDNET shall have complied, in all material
respects, with all agreements, obligations and conditions required by this
Agreement to be complied with by it on or prior to the Closing Date.
Section 7.3 OFFICER'S CERTIFICATE. VDAT and SUB shall have received a
duly executed certificate signed by the President or Chairman of EDNET
certifying as to (i) compliance with the conditions set forth in Sections 7.1
and 7.2; (ii) the accuracy and completeness of the Bylaws of EDNET and the
director and shareholder resolutions of EDNET approving this Agreement, the
Merger and the transactions contemplated hereby; and (iii) the identity and
authority of the officers and other persons executing documents on behalf of
EDNET. VDAT and SUB shall have received a duly executed certificate signed by an
EDNET Shareholder certifying as to the compliance with the condition set forth
in Section 7.1.
Section 7.4 CERTIFIED CERTIFICATE OF INCORPORATION. VDAT and SUB shall
have received a certificate of the Secretary of State of the State of Delaware
certifying the Certificate of Incorporation of EDNET and all amendments thereof,
dated not more than ten (10) days prior to the Closing Date.
Section 7.5 GOOD STANDING. VDAT shall have received a certificate of
good standing, or its equivalent, dated no more than ten (10) days prior to the
Closing Date, from the state of
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incorporation of EDNET and each other state in which EDNET is qualified to do
business as set forth on Schedule 4.1.
Section 7.6 LEGAL ACTION. There shall be no pending or threatened legal
action or inquiry which challenges the validity or the legality of or seeks or
could reasonably be expected to prevent, delay or impose conditions on the
consummation of the Merger or would otherwise restrict VDAT's or the Surviving
Corporation's exercise of full rights to own and operate the business of EDNET
subsequent to the Effective Time.
Section 7.7 CONSENTS. VDAT and SUB shall have received copies of
consents of all third parties necessary for EDNET to execute, deliver and
perform this Agreement and consummate the Merger.
Section 7.8 EDNET DOCUMENTS. VDAT and SUB shall have received an
executed copy of the legal opinion of EDNET's legal counsel, which legal opinion
will be in a form and substance reasonably acceptable to VDAT and its counsel.
Section 7.9 DISSENTING SHARES. On the Closing Date, the aggregate
number of EDNET Shares with respect to which the holders shall be dissenting
shareholders entitled to relief under Section 262 of the DGCL shall not exceed
five percent (5%) of all outstanding EDNET Shares.
Section 7.10 MATERIAL ADVERSE CHANGE. There shall have been no material
adverse change in the business, operations, assets, prospects, financial
condition or results of operations of EDNET.
Section 7.11 AGREEMENTS WITH AFFILIATES. VDAT and SUB shall have
received from each person who is an Affiliate under Section 5.10 an executed
copy of the written agreement referred to in Section 5.10 and such agreements
shall be in full force and effect and there shall be no breach, or in existence
any facts which with passage of time or otherwise could constitute a breach,
thereof.
Section 7.12 CERTIFICATE OF MERGER. EDNET shall have delivered to VDAT
the Certificate of Merger as executed by duly authorized officers of EDNET.
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF EDNET
The obligations of EDNET to effect the Merger and to perform under this
Agreement is subject to the fulfillment on or before the Closing Date of the
following additional conditions, any one or more of which may be waived, in
writing, by EDNET:
Section 8.1 REPRESENTATIONS ACCURATE. The representations and
warranties of VDAT and SUB contained herein shall be true and correct on the
date of this Agreement and at and on the Closing Date as though such
representations and warranties were made at and on such date.
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Section 8.2 PERFORMANCE. VDAT and SUB shall have complied, in all
material respects, with all agreements, obligations and conditions required by
this Agreement to be complied with by them on or prior to the Closing Date.
Section 8.3 COMPLIANCE CERTIFICATE. EDNET shall have received a
certificate signed by the President or Chairman of each of VDAT and SUB
certifying as to (i) compliance with the conditions set forth in Sections 8.1
and 8.2; (ii) the accuracy and completeness of the Bylaws of SUB and, as
applicable, the director and shareholder resolutions of VDAT and SUB approving
this Agreement, the Merger and the transactions contemplated hereby; and (iii)
the identity and authority of the officers and other persons executing documents
on behalf of VDAT and SUB.
Section 8.4 CERTIFIED ARTICLES OF INCORPORATION. EDNET shall have
received certificates of the Secretary of State of the State of Florida
certifying the Articles of Incorporation of VDAT and the Articles of
Incorporation of SUB and all amendments thereof, dated not more than ten (10)
days prior to the Closing Date.
Section 8.5 GOOD STANDING. EDNET shall have received a certificate of
good standing, or its equivalent, dated no more than ten (10) days prior to the
Closing Date, from the state of incorporation of VDAT and SUB and each other
state in which VDAT and SUB are qualified to do business, which states are set
forth on Schedule 8.5.
Section 8.6 LEGAL ACTION. There shall be no pending or threatened legal
action or inquiry which challenges the validity or legality of or seeks or could
reasonably be expected to prevent, delay or impose conditions on the
consummation of the Merger.
Section 8.7 CONSENTS. EDNET shall have received copies of consents of
all third parties necessary for VDAT to execute, deliver and perform this
Agreement and consummate the Merger.
Section 8.8 CERTIFICATE OF MERGER. SUB shall have delivered to EDNET
the Certificate of Merger, executed by duly authorized officers of SUB.
ARTICLE IX
CLOSING
Section 9.1 TIME AND PLACE. Subject to the provisions of Articles VI,
VII, VIII and X, the closing of the Merger (the "Closing") shall take place at
the offices of Atlas Xxxxxxxx, P.A., as soon as practicable, but in no event
later than the second business day after the date on which each of the
conditions set forth in Articles VI, VII and VIII (other than those conditions
that by their nature are to be satisfied at the Closing but subject to such
conditions) have been satisfied or waived, in writing, by the party or parties
entitled to the benefit of such conditions; or at such other place, at
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such other time, or on such other date as VDAT, SUB and EDNET may, in writing,
mutually agree. The date on which the Closing actually occurs is herein referred
to as the "Closing Date."
Section 9.2 FILINGS AT THE CLOSING. Subject to the provisions of
Articles VI, VII, VIII and X hereof, EDNET, VDAT and SUB shall cause to be
executed and filed at the Closing the Certificate of Merger and shall cause the
Certificate of Merger to be recorded in accordance with the applicable
provisions of the FBCA and the DGCL and shall take any and all other lawful
actions and do any and all other lawful things necessary to cause the Merger to
become effective.
ARTICLE X
TERMINATION AND ABANDONMENT
Section 10.1 TERMINATION. This Agreement may be terminated at any time
prior to the Effective Time, whether before or after approval by the
shareholders of EDNET and VDAT:
(a) by mutual consent of VDAT and EDNET;
(b) by either VDAT or EDNET, if any court of competent jurisdiction in
the United States or other governmental body in the United States shall have
issued an order (other than a temporary restraining order), decree or ruling or
taken any other action restraining, enjoining or otherwise prohibiting the
Merger, and such order, decree, ruling or other action shall have become final
and nonappealable;
(c) by either VDAT or EDNET, if the requisite shareholder approvals of
the shareholders of either VDAT or EDNET are not obtained at a meeting of
shareholders duly called and held therefor; or
(d) by either VDAT or EDNET if a merger shall not have been consummated
by December 31, 2001, provided that a party in material breach of this Agreement
may not terminate this Agreement.
Section 10.2 TERMINATION BY VDAT. This Agreement may be terminated and
the Merger may be abandoned, at any time prior to the Effective Time, before or
after the approval of the shareholders of VDAT or EDNET, by VDAT if (a) EDNET
shall have failed to comply in any material respect with any of the covenants or
agreements contained in Articles I, II and V of this Agreement to be complied
with by EDNET at or prior to such date of termination, (b) there exists a breach
of any representation or warranty of EDNET contained in this Agreement such that
the closing conditions set forth in Article VII would not be satisfied,
provided, however, that with respect to either (a) or (b), if such failure or
breach is capable of being cured prior to the Effective Time, such failure or
breach shall not have been cured within fifteen (15) days of delivery to EDNET
of written notice of such failure or breach, (c) the Board of Directors of EDNET
shall have failed to recommend, or shall have withdrawn, modified or changed its
recommendation of this Agreement
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or the Merger in a manner adverse to VDAT or shall have recommended or issued a
neutral recommendation with respect to any proposal in respect of a Transaction
Proposal (as defined in Section 5.2 above) with a person or entity other than
VDAT or any Affiliate of VDAT (or the EDNET Board of Directors resolves to do
any of the foregoing), or (d) the Board of Directors of EDNET shall furnish or
disclose nonpublic information or negotiate, explore or communicate in any way
with a third party with respect to any Transaction Proposal, or shall have
resolved to do any of the foregoing and publicly disclosed such resolution.
Section 10.3 TERMINATION BY EDNET. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time, before or
after the approval by the shareholders of VDAT or EDNET, by EDNET, if (a) VDAT
or SUB shall have failed to comply in any material respect with any of the
covenants or agreements contained in Articles I, II and V of this Agreement to
be complied with by VDAT or SUB at or prior to such date of termination, (b)
there exists a breach of any representation or warranty of VDAT or SUB contained
in this Agreement such that the closing conditions set forth in Article VIII
would not be satisfied, provided, however, that, with respect to either (a) or
(b), if such failure or breach is capable of being cured prior to the Effective
Time, such failure or breach shall not have been cured within fifteen (15) days
of delivery to VDAT or SUB of written notice of such failure or breach, or (c)
the Board of Directors of EDNET shall have failed to recommend or shall have
withdrawn, modified or changed its recommendation of this Agreement in a manner
adverse to VDAT or shall have recommended or issued a neutral recommendation
with respect to any proposal in respect of a Transaction Proposal with a person
or entity other than VDAT or any Affiliate of VDAT (or the Board of Directors of
VDAT, respectively, resolves to do any of the foregoing), in each case in
accordance with and solely to the extent permitted by Section 5.2 above.
Section 10.4 PROCEDURE FOR TERMINATION. In the event of termination and
abandonment of the Merger by VDAT or EDNET pursuant to this Article X, written
notice thereof shall forthwith be given to the other.
Section 10.5 EFFECT OF TERMINATION AND ABANDONMENT. In the event of
termination of this Agreement and abandonment of the Merger pursuant to this
Article X, no party hereto (or any of its directors or officers) shall have any
liability or further obligation to any other party to this Agreement, except as
provided in this Section 10.5 and in Section 5.3(b) hereof. Nothing in this
Section 10.5 shall relieve any party from liability for willful breach of this
Agreement.
ARTICLE XI
SURVIVABILITY; INVESTIGATIONS
Section 11.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. None of the
representations, warranties and covenants of EDNET, VDAT and SUB will survive
the Effective Time.
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Section 11.2 INVESTIGATION. The respective representations and
warranties of VDAT, SUB, EDNET and the EDNET Shareholders contained herein or in
any certificate or other documents delivered prior to or at the Closing shall
not be deemed waived or otherwise affected by any investigation made by any
party hereto.
ARTICLE XII
MISCELLANEOUS
Section 12.1 NOTICES. All notices shall be in writing delivered as
follows:
If to VDAT or SUB, to:
Visual Data Corporation
0000 X.X. 00xx Xxxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
With a copy to:
Atlas Xxxxxxxx, P.A.
000 Xxxx Xxx Xxxx Xxxxxxxxx, Xxxxx 0000
Xxxx Xxxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxxx, Esq.
If to EDNET, to:
Entertainment Digital Network, Inc.
Xxx Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx, President
With a copy to:
Xxxxxx & Diamond
00 Xxx Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx, Esq.
or to such other address as may have been designated in a prior notice pursuant
to this Section. Notices shall be deemed to be effectively served and delivered
(a) when delivered personally; (b) when given by telephone facsimile (with a
copy mailed by first-class U.S. mail); (c) one (1) business day following
deposit with a recognized national air courier service; or (d) three (3)
business days
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after being deposited in the United States mail in a sealed envelope, postage
prepaid, return receipt requested, to the appropriate party.
Section 12.2 BINDING EFFECT. Except as may be otherwise provided
herein, this Agreement will be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns, but
neither this Agreement nor any of the rights or obligations hereunder shall be
assigned by any of the parties hereto without the prior written consent of the
other parties. Except as otherwise specifically provided in this Agreement,
nothing in this Agreement is intended or will be construed to confer on any
person other than the parties hereto any rights or benefits hereunder.
Section 12.3 HEADINGS. The headings in this Agreement are intended
solely for convenience of reference and will be given no effect in the
construction or interpretation of this Agreement.
Section 12.4 EXHIBITS AND SCHEDULES. The Exhibits and schedules
referred to in this Agreement will be deemed to be a part of this Agreement.
Section 12.5 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which will be deemed an original, and all of which
together will constitute one and the same document.
Section 12.6 GOVERNING LAW. This Agreement will be governed by the laws
of the State of Florida without regard to conflict of laws principles thereof.
Section 12.7 WAIVERS. Compliance with the provisions of this Agreement
may be waived only a written instrument specifically referring to this Agreement
and signed by the party waiving compliance. No course of dealing, nor any
failure or delay in exercising any right, will be construed as a waiver, and no
single or partial exercise of a right will preclude any other or further
exercise of that or any other right.
Section 12.8 PRONOUNS. The use of a particular pronoun herein will not
be restrictive as to gender or number but will be interpreted in all cases as
the context may require.
Section 12.9 TIME PERIODS. Any action required hereunder to be taken
within a certain number of days will be taken within that number of calendar
days; provided, however, that if the last day for taking such action falls on a
weekend or a holiday, the period during which such action may be taken will be
automatically extended to the next business day.
Section 12.10 MODIFICATION. No supplement, modification or amendment of
this Agreement will be binding unless made in a written instrument that is
signed by all of the parties hereto and that specifically refers to this
Agreement.
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Section 12.11 ENTIRE AGREEMENT. This Agreement and the agreements and
documents referred to in this Agreement or delivered hereunder are the exclusive
statement of the agreement among the parties concerning the subject matter
hereof. All negotiations among the parties are merged into this Agreement, and
there are no representations, warranties, covenants, understandings, or
agreements, oral or otherwise, in relation thereto among the parties other than
those incorporated herein and to be delivered hereunder.
Section 12.12 SEVERABILITY. If any one or more of the provisions of
this Agreement shall be held to be invalid, illegal or unenforceable, the
validity, legality or enforceability of the remaining provisions of this
Agreement shall not be affected thereby. To the extent permitted by applicable
law, each party waives any provision of law which renders any provision of this
Agreement invalid, illegal or unenforceable in any respect.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective duly authorized officers as of the date first above
written.
VISUAL DATA CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx, President
ENTERTAINMENT DIGITAL NETWORK, INC.
By: /s/ Xxxxx Xxxxxxxxx
-------------------------------
Xxxxx Xxxxxxxxx, President
VISUAL DATA SAN FRANCISCO
By: /s/ Xxxxx Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx, President
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AGREEMENT AND PLAN OF MERGER
SCHEDULES
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1
