Exhibit 10.7
IVI COMMUNICATIONS, INC. & BROADSPOT WORLD WIDE WIRELESS, INC.
STOCK EXCHANGE AGREEMENT
This Stock Exchange (hereinafter the "Agreement") is entered into effect as of
this 31st day of March 2004, between the parties, ("The Parties") IVI
Communications, Inc., a Nevada corporation (hereinafter "IVIC"), and Broadspot
World Wide Wireless, Inc., a Canada corporation (hereinafter "BWWW").
RECITALS
WHEREAS, subject to approval of the Boards of Directors of BWWW and IVIC, The
Parties agree to exchange twenty-three million (23,000,000) of the shares of
BWWW for nine million (9,000,000) of the shares of IVIC.
NOW, THEREFORE, for the mutual consideration set out herein and other good and
valuable consideration, the legal sufficiency of which is hereby acknowledged,
the parties agree as follows:
AGREEMENT
1. Plan of Exchange
a It is hereby agreed that twenty-three million (23,000,000) of the
shares of BWWW common stock (the "BWWW Shares") shall be exchanged
for nine million (9,000,000) of the shares of the IVIC common stock.
b It is further agreed that BWWW shall provide:
i The complete and current list of BWWW shareholders
ii The documentation of DTC eligibility of BWWW stock
42
iii The complete and current NOBO shareholder list
2. Exchange of Shares The Parties agree that on the Closing Date or at the
Closing as hereinafter defined, the BWWW Common Stock shall be
delivered to a mutually agreed upon escrow agent ("Agent") in exchange
for the IVIC Shares as follows:
a At Closing IVIC shall, subject to the conditions set forth herein,
issue from treasury nine million (9,000,000) shares of IVIC common
stock for delivery to Agent.
b At Closing BWWW shall, subject to the conditions set forth herein,
shall deliver twenty-three million (23,000,000) of the shares of BWWW
common stock for delivery to Agent.
3. Pre-Closing Events The Closing is subject to the completion of the
following:
a BWWW shall have delivered to Agent in trust for delivery to IVIC
twenty-three million (23,000,000) shares of BWWW common stock.
b BWWW shall have effectuated the delivery to Agent of the BWWW Shares
at or prior to Closing, and shall have thirty million one hundred
forty-two thousand six hundred ninety-nine (30,142,699) shares of its
common stock issued and outstanding and no other shares of capital
stock issued or outstanding.
c IVIC shall have authorized issuance of and delivered to Agent in
trust for delivery to the BWWW nine million (9,000,000) shares of
IVIC common stock.
d IVIC shall have effectuated the delivery to Attorney of the IVIC
Shares at or prior to Closing, and shall have twenty two million
seven hundred ten thousand two hundred fifty-seven (22,710,257)
shares of its common stock issued and outstanding and no other shares
of capital stock issued or outstanding.
e BWWW shall demonstrate to the reasonable satisfaction of IVIC that
(i) it has no material assets and no liabilities, contingent or fixed
(ii) it is current and in compliance with all required filings under
the Securities Exchange Act of 1934, as amended and (iii) it will
undertake and cooperate fully in the preparation and filing of any
requisite Registration Statement for the issuance and delivery of the
IVIC Shares to the BWWW Shareholders.
4. Exchange of Securities As of the Closing Date, the following shall occur:
a IVIC shall issue from treasury nine million (9,000,000) shares of the
IVIC common stock for delivery to BWWW. b BWWW shall transfer
twenty-three million (23,000,000) of the shares of BWWW common stock
for delivery to IVIC.
5. Other Events Occurring at Closing At Closing, the following shall be
accomplished:
a The appointment, by the existing BWWW officers and directors ("Old"),
of Xxxx Xxxxxx and Xxxxxxx Xxxxxxxxxx as the new officers and
directors of BWWW ("New").
b The resignation of the Old BWWW officers and directors.
43
c The acceptance, by the New officers and directors of BWWW, of the
resignation of the Old officers and directors.
6. Representations of BWWW BWWW hereby represents and warrants as follows,
which warranties and representations shall also be true as of the Closing
Date:
a Except as noted on Exhibit "A," the BWWW Stockholders listed on the
attached Exhibit "A" are the sole owners of record and beneficially
of the issued and outstanding common stock of BWWW.
b BWWW has one class of common to be issued.
7. Representations of IVIC IVIC hereby represents and warrants as follows,
each of which representations and warranties shall continue to be true
as of the Closing Date:
a As of the Closing Date, the IVIC Shares, to be issued and delivered
to the BWWW Stockholders hereunder will, when so issued and
delivered, constitute, duly authorized, validly and legally issued
shares of IVIC common stock, fully paid and non-assessable.
b IVIC has the corporate power to enter into this Agreement and to
perform its respective obligations hereunder. The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by the board of
directors of IVIC. The execution and performance of this Agreement
will not constitute a material breach of any agreement, indenture,
mortgage, license or other instrument or document to which IVIC is a
party and will not violate any judgment, decree, order, writ, rule,
statute, or regulation applicable to IVIC or its properties. The
execution and performance of this Agreement will not violate or
conflict with any provision of the Articles of Incorporation or
bylaws of IVIC.
c IVIC will deliver to BWWW a true and complete copy of its audited
financial statements for the period ended December 31, 2003 (the
"IVIC Financial Statements"). The IVIC Financial Statements are
complete, accurate and fairly present the financial condition of IVIC
as of the dates thereof and the results of its operations for the
periods then ended. There are no material liabilities or obligations
either fixed or contingent not reflected therein. The IVIC Financial
Statements have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis (except as may be
indicated therein or in the notes thereto) and fairly present the
financial position of IVIC as of the date thereof and the results of
its operations and changes in financial position for the periods then
ended.
44
d Since December 31, 2003, there have not been any material adverse
changes in the financial condition of IVIC except with regard to
disbursements to pay reasonable and ordinary expenses in connection
with maintaining its corporate status and pursuing the matters
contemplated in this Agreement. Prior to Closing, all accounts
payable and other liabilities of IVIC shall be paid and satisfied in
full and IVIC shall have no liabilities either contingent or fixed.
e IVIC is not a part to or the subject of any pending litigation,
claims or governmental investigation or proceeding not reflected in
the IVIC Financial Statements or otherwise disclosed herein, and
there are no lawsuits, claims, assessments, investigations or similar
matters, threatened or contemplated against or affecting IVIC, its
management or its properties.
f IVIC is duly organized, validly existing and in good standing under
the laws of the State of Nevada; has the corporate power to own its
property and to carry on its business as now being conducted and is
duly qualified to do business in any jurisdiction where so required
except where the failure to so qualify would have no material
negative impact on it.
g IVIC has field all federal, state, county and local income, excise,
property and other tax, governmental and/or related returns, forms,
or reports, which re due or required to be filed by it prior to the
date hereof, except where the failure to do so would have no material
adverse impact on IVIC, and has paid or made adequate provision in
the IVIC Financial Statements for the payment of all taxes, fees, or
assessments which have or may become due pursuant to such returns or
pursuant to any assessments received. IVIC is not delinquent or
obligated for any tax penalty, interest, delinquency or charge.
h There are no exiting options, calls, warrants, preemptive rights or
commitments of any character relating to the issued or unissued
capital stock or other securities of IVIC, except as contemplated in
this Agreement.
i IVIC has not breached, nor is there any pending, or to the knowledge
of management, any threatened claim that IVIC has breached, any of
the terms or conditions of any agreements, contract or commitments to
which it is a party or by which it or its assets are bound. The
execution and performance hereof will not violate any provisions of
applicable law or any agreement to which IVIC is subject. IVIC hereby
represents that it has no business operations or material assets and
it is not a party to any material contract or commitment other than
appointment documents with its transfer agent, and that it has
disclosed BWWW all relationships or dealings with related parties or
affiliates.
45
j All information regarding IVIC which has been provided to BWWW or
otherwise disclosed in connection with the transactions contemplated
herein is true, complete and accurate in all material respects. IVIC
specifically disclaims any responsibility regarding disclosures as to
BWWW, its business or its financial condition.
8. Closing The initial Closing of the transactions contemplated herein shall
take place on such date (the "Closing") as mutually determined by the
parties hereto when all conditions precedent have been met and all required
documents have been delivered, which Closing shall be no later than March
31, 2004, unless extended by mutual consent of all parties hereto. The
Final Closing Date shall be the date after all BWWW Shareholders have
executed appropriate agreements for the exchange their shares of BWWW stock
which shall occur only after the effective date of the Registration
Statement. The "Closing Date" of the transactions descried herein (the
"Acquisition"), shall be that date on which the IVIC Shares are delivered
to BWWW and all conditions set forth herein other than the effectiveness of
the Registration Statement and the Exchange have been met and the IVIC
Shares are issued in exchange for the BWWW Common Stock.
9. Conditions Precedent to the Obligations of BWWW All obligations of BWWW
under this Agreement are subject to the fulfillment, prior to or as of the
Closing and/or the Closing Date, as indicated below, of each of the
following conditions:
a The representations and warranties by or on behalf of IVIC contained
in this Agreement or in any certificate or document delivered
pursuant to the provisions hereof shall be true in all material
respects at and as of the Closing and Closing Date as though such
representations and warranties were made at and as of such time.
b IVIC shall have performed and complied with all covenants,
agreements, and conditions set forth in, and shall have executed and
delivered all documents required by this Agreement to be performed or
complied with or executed and delivered by it prior to or at the
Closing.
c On or before the Closing, the board of directors representing a
majority interest in the outstanding common stock of IVIC, shall have
approved in accordance with applicable state corporation law, the
execution and delivery of this Agreement and the consummation of the
transactions contemplated herein.
46
d On or before the Closing Date, IVIC shall have delivered to BWWW
copies of resolutions of the board of directors and shareholders of
IVIC approving and authorizing the execution, delivery and
performance of this Agreement and authorizing all of the necessary
and proper action to enable IVIC to comply with the terms of this
Agreement including the election of BWWW's nominees to the Board of
Directors of IVIC and all matters outlined herein.
e The Acquisition shall be permitted by applicable law and IVIC shall
have sufficient shares of its capital stock authorized to complete
the Acquisition.
f At Closing, the existing officers and directors of BWWW shall have
resigned in writing from all positions as officers and directors of
BWWW effective upon the election and appointment of IVIC officers and
directors.
g At the Closing, all instruments and documents delivered to BWWW and
BWWW Stockholders pursuant to the provisions hereof shall be
reasonably satisfactory to legal counsel for BWWW.
h The shares of restricted IVIC capital stock to be issued to BWWW
nonassessable and fully paid under Nevada corporation law and will be
issued in compliance with all federal, state and applicable
corporation and securities laws.
i BWWW and BWWW Stockholders shall have received the advice of their
tax advisors, if deemed necessary by them, as to all tax aspects of
the Acquisition.
j BWWW shall have received all necessary and required approvals and
consents from required parties.
10. Conditions Precedent to the Obligations of IVIC All obligations under
this Agreement are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions:
47
a The representations and warranties by BWWW contained in this
Agreement or in any certificate or document delivered pursuant to the
provisions hereof shall be true in all material respects at and as of
the Closing as though such representations and warranties were made
at and as of such time.
b BWWW shall have performed and complied with, in all material
respects, all covenants, agreements and conditions required by this
Agreement to be performed or complied with by it prior to or at the
Closing;
11. Indemnification For a period of one year from the Closing, IVIC agrees
to indemnify and hold harmless BWWW, and BWWW agrees to indemnify and hold
harmless IVIC, at all times after the date of this Agreement against and in
respect of any liability, damage or deficiency, all actions, suits,
proceedings, demands, assessments, judgments, costs and expenses, including
attorneys' fees incident to any of the foregoing, resulting from any
material misrepresentations made by an indemnifying party to an indemnified
party, an indemnifying party's breach of covenant or warranty or an
indemnifying party's non-fulfillment of any agreement hereunder or from any
material misrepresentation in or omission from any certificate furnished or
to be furnished hereunder.
12. Nature and Survival of Representations All representations, warranties
and covenants made by any party in this Agreement shall survive the Closing
and the consummation of the transactions contemplated hereby for one year
from the Closing. All of the parties hereto are executing and carrying out
the provisions of this Agreement in reliance solely on the representations,
warranties and covenants and agreements contained in this Agreement and not
upon any investigation upon which it might have made or any representation,
warranty, agreement, promise or information, written or oral, made by the
other party or any other person other than as specifically set forth
therein.
13. Documents at Closing At the Closing, the following documents shall be
delivered: a BWWW will deliver, or will cause to be delivered, to IVIC the
following:
i A certificate executed by the President and Secretary of BWWW to
the effect that all representations and warranties made by BWWW
under this Agreement are true and correct as of the Closing, the
same as though originally given to IVIC on said date.
ii A certificate from Industry Canada dated at or about the Closing
to the effect that BWWW is in good standing under the laws of
said jurisdiction.
48
iii Such other instruments, documents and certificates, if any, as
are required to be delivered pursuant to the provisions of this
Agreement.
iv Certified copies of resolutions adopted by the directors of BWWW
authorizing this transaction.
v All other items, the delivery of which is a condition precedent
to the obligations of IVIC as set forth herein.
b IVIC will deliver or cause to be delivered to BWWW:
i Stock certificates representing the IVIC Shares to be issued as
a part of the stock exchange as described herein.
ii Certified copies of resolutions adopted by IVIC's board of
directors authorizing the exchange of shares and all related
matters described herein;
14. Miscellaneous
a Further Assurances. At any time, and from time to time, after the
Closing Date, each party will execute such additional instruments and
take such action as may be reasonably requested by the other party to
confirm or perfect title to any property transferred hereunder or
otherwise to carry out the intent and purposes of this Agreement.
b Waiver. Any failure on the part of any party hereto to comply with
any of its obligations, agreements, or conditions hereunder may be
waived in writing by the party to whom such compliance is owed.
c Termination. All obligations hereunder may be terminated at the
discretion of either party's board of directors if (i) the closing
conditions specified Sections 12 and 13 are not met by April 7, 2004,
unless extended in writing, or (ii) any of the representations and
warranties made herein have been materially breached.
49
d Amendment. This Agreement may be amended only in writing as agreed to
by all parties hereto.
e Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been given if delivered or sent
by prepaid first-class registered or certified mail, return receipt
requested.
f Headings. The section and subsection headings in this Agreement are
inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
g Counterparts. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
h Governing Law. This Agreement shall be construed and enforce in
accordance with the laws of the State of Nevada.
i Binding Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective
heirs, administrators, executors, successors and assigns.
j Entire Agreement. This Agreement and the attached Exhibits constitute
the entire agreement of the patties covering everything agreed upon
or understood in the transaction. There are no oral promises,
conditions, representations, understandings, interpretations or terms
of any kind as conditions or inducements to the execution hereof.
k Time. Time is of the essence.
l Severability. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force
and effect.
m Responsibility and Costs. All fees, expenses and out-of-pocket costs
and expenses, including, without limitation, fees and disbursements
of counsel, advisors and accountants, incurred by the parties hereto
shall be borne solely and entirely by the party that has incurred
such costs and expenses regardless of whether the transactions
contemplated herein are completed.
50
IN WITNESS WHEREOF, the parties have executed this Agreement the day and year
first above written.
Broadspot World Wide Wireless, Inc.
By:/s/ Xxxxxxx Xxxxxx
-----------------------------
Xxxxxxx Xxxxxx
Its:Chief Executive Officer
IVI Communications, Inc.
By: /s/ Xxxx Xxxxxx
-----------------------------
Xxxx Xxxxxx
Its:Chief Executive Officer
51
