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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
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March 9, 2000
Date of Report (Date of earliest event reported)
HOUSEHOLD DIRECT.com, INC.
(Exact name of registrant as specified in its charter)
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DELAWARE
(State or other (Commission 51-0388634
jurisdiction of File Number) (I.R.S. Employer
incorporation Identification No.)
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HOUSEHOLD DIRECT.com, INC.
900 MAIN STREET SOUTH
SOUTHBURY, CONNECTICUT 06488
(Address of principal executive offices) (Zip Code)
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(203) 267-1400
(Registrant's telephone number, including area code)
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CROSS CHECK CORP.
P.O. BOX 1049
NIWOT, CO. 80544
(Former name or former address, if changed since last report)
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Item 1. CHANGES IN CONTROL OF REGISTRANT
On March 9, 2000, HouseHold Direct.com, Inc., a Delaware corporation
("HouseHold" or "Company") executed an Agreement and Plan of Merger with Cross
Check Corp., a Colorado Corporation ("Cross" or the "Registrant") and a Letter
Agreement with the shareholders of Cross whereby HouseHold Direct acquired all
the issued and outstanding shares of the Registrant for the purpose of
completing a merger of HouseHold and Cross. On March 20, 2000 HouseHold and
Cross completed a merger with HouseHold being the surviving entity.
Item 2. ACQUISITION OR DISPOSITION OF ASSETS
HouseHold was originally incorporated as RDI Marketing, Inc., a Florida
corporation ("RDI") on January 2, 1992. The corporation historically had no
material business operations other than maintaining its status. On May 18, 1998
RDI filed a disclosure statement under Rule 15C2-11 of the Securities and
Exchange Act of 1934 ("1934 Act") with the National Association of Securities
Dealers (NASD); RDI received clearance to enter quotations on the OTC Bulletin
Board on June 11, 1998 and began trading under the symbol "RDIM." On July 10,
1998 RDI entered into an Exchange Agreement with Preferred Consumer Network
International, Inc., a Delaware corporation ("PCNI") whereby PCNI became a
wholly owned subsidiary of RDI and the former PCNI shareholders, in the
aggregate, became the majority shareholders of RDI owning ninety percent (90%)
of the issued and outstanding common stock of the Company.
The Company (directly and/or through its then wholly owned subsidiary)
operated a "wholesale buyers club" business whereby consumers could purchase a
membership that would entitle them to purchase certain durable and non-durable
consumer goods at wholesale or factory direct prices. The Company curtailed
material operations in late December of 1998 to allow management to revise its
business plan and to seek capital funding to implement its new business
strategy.
To be consistent with the Company's new business and marketing plan as a
wholesale buyers club, RDI changed its exchange symbol to "BYIT" effective July
12, 1999. Contemporaneously with the symbol change the Company was
reincorporated in the State of Delaware under its current name, HouseHold
Direct.com, Inc.
The Company operates a specialized sales business known as a "wholesale
buyers club." As stated above, a "wholesale buyers club" is a business whereby
consumers purchase a membership which allows them to buy certain durable and
non-durable consumer goods at wholesale and factory direct prices.
Historically buyers clubs have charged up to a $1,500.00 membership fee
upon initial application by the consumer and then charged a handling fee of up
to ten percent (10%) on all member purchases. As part of its business strategy,
the Company has radically reduced the initial membership fee as discussed below.
HouseHold's goal in decreasing the membership fee is to stimulate
membership growth. It is the Company's belief that in order for it to be
profitable, it must have a large membership base. Consequently the Company has
recently embarked on implementing a growth oriented business strategy.
HouseHold's business strategy is two fold: i) consolidate a number
of buyers clubs in different cities across the country by acquisition thereby
allowing the Company to rapidly increase its
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membership base; and ii) implement a new ecommerce website/portal to improve
services to customers and market memberships to prospective members.
As stated earlier, the Company intends to acquire a number of buyers
clubs in different cities across the United States. According to industry
sources, over 150 private/independent buyers clubs exist in the United States
servicing an existing membership base of 2.5 million consumer members. It is
from this group the Company will seek to locate acquisition candidates. As of
the date hereof, the Company has identified and acquired one single unit buying
club in Atlanta, Georgia, Preferred Consumer Services, Inc. ("PCS"). HouseHold
estimates that the PCS acquisition will bring approximately 10,000 members to
the Company with annual product purchase expenditures of approximately 3 million
dollars annually. The Company is currently reviewing other potential
acquisitions but has not entered into any agreements or engaged in any material
negotiations with any specific targets.
HouseHold is unlikely to identify specific targets and enter into any
further material agreements until such time as the Company has raised sufficient
capital to fund any such potential acquisitions.
The Company is currently attempting to concentrate on building
membership. The primary methods the Company is either currently employing or
intends to employ are: i) acquisitions (as described above); ii) marketing and
selling memberships through the Internet; iii) direct mail and telemarketing
solicitation; and iv) the potential use of franchising and joint ventures to
expand the geographical reach of the Company both domestically and
internationally.
Should the Company be successful in acquiring a significant membership
the Company will receive revenues from essentially three sources: i) an initial
application/membership fee of $49.95; ii) monthly maintenance club dues of $9.95
per month; and iii) a service fee of between 5% and 10% of each member's
merchandise purchases made through the Company.
Concurrently with building its membership base, the Company will be
utilizing proprietary data management systems to evaluate its members, their
buying habits and preferences. The information will be used by the Company to
identify and then offer the products most desired by the Company's membership.
Management believes that the increase in product offerings will also increase
customer satisfaction and thus word of mouth customer referrals to the Company.
In addition to acquiring buyers clubs, the Company will also seek to
acquire or enter into strategic relationships with other businesses that will
assist HouseHold in servicing the needs of its members. Included in this group
would be warehouse facilities, packaging and fulfillment service businesses and
shipping companies.
The Company has already acquired Thunderstick, Inc., a business that has
expertise in Internet technology, which will support HouseHold's web site and
ecommerce management software. Currently the Company is in the process of
identifying potential acquisition targets, but has not entered into any
arrangements with or specifically identified any specific companies that they
will acquire or with whom they might enter into a strategic relationship.
Although HouseHold is at an early stage of its development, it has
already acquired PCS and Thunderstick. HouseHold is therefore in the process of
implementing its business plan to put into place the building blocks or
components it believes will make its business a success. These blocks include:
i) the use of state of the art technologies for web site design and ecommerce
application
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software; ii) utilization of centralized purchasing and fulfillment; iii) the
Company's "cost plus" club shopping format and iv) expedited discount shipping
of member's purchases.
HouseHold believes that there are significant opportunities for
marketing its "cost plus" business format through the Company's web site, with
potential members in countries outside of the United States. Consumers in
selected foreign markets would be able to purchase goods that are unavailable or
unique to their local market and at a price significantly lower than comparable
local goods. The Company is aware that there are significant restrictions
concerning certain types of exports and other restrictions that require the
Company to exclude potential customers who are located in certain countries with
whom the Company is prevented, by law, with doing business. HouseHold intends to
comply with all export laws and regulations and believes that such compliance
will not have a material impact on its business.
Item 3. BANKRUPTCY OR RECEIVERSHIP
None.
Item 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
As a result of the HouseHold and Cross merger and HouseHold being the
surviving entity, HouseHold's auditors, King Griffin & Adamson, P.C., 14160,
Dallas Parkway, Ninth Floor, Dallas, Texas 75240 will be the auditors of record
for the Company.
Item 5. OTHER EVENTS
None.
Item 6. RESIGNATION AND APPOINTMENT OF DIRECTORS
As a consequence of the HouseHold and Cross merger and HouseHold being
the surviving entity, Cross' Board of Directors will be dissolved. The two
current directors of HouseHold are as follows:
John D. Folger, 50, Director, President and Chief Executive Officer. Mr. Folger
is one of the original founders of HouseHold and has served as its president and
CEO since its inception in 1997. From 1995 to 1996, Mr. Folger was a joint
venture partner and vice president in a business called the Virtual Visitor
Center/Online Business Associates which was an internet business specializing as
a consumer gateway. Mr. Folger is currently active as an equity investor in
Huntingtown Farm, a real estate development that he has been involved in since
1993. Prior to becoming involved with Huntingtown Farm, Mr. Folger acted as a
business consultant with Armour Funding, Inc. and The Investor Group, Inc.
Ann D. Jameson, 57, Director, Vice President of Operations and
Secretary/Treasurer. Ms. Jameson's is also one of the original founders of
HouseHold and has served in her current capacities with the Company since 1997.
Prior to her employment with the Company, Ms. Jameson was an executive
consultant with Laughter Works Seminars, Inc., where she developed specialized
programs and strategies for corporate and small business clients. In 1996, Ms.
Jameson was employed by the Carvel Corporation as Staff Administrator, Human
Resources and Training. Before her employment with Carvel, Ms. Jameson served as
Manager, Community Affairs and Employee Services from 1969 to 1996 for the
Hartford Life Company, a division of the Hartford Insurance Group.
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Both Mr. Folger, as an officer, and Ms. Jameson, as an employee, are
currently involved in the completion of the winding up of Preferred Consumer
Network International, Inc. ("PCNI"). PCNI acquired the operating assets of an
earlier business known as United Buyers Service of Massachusetts, which was
engaged in the sale of memberships in and the operation of a consumer wholesale
buyers club. As a result of the failure of these businesses, certain payroll
taxes were left unpaid. The Internal Revenue Service ("IRS") has instituted
collection of the payroll taxes and placed liens on certain real property of Mr.
Folger and Ms. Jameson. Both parties are currently attempting to obtain and
complete a settlement of the IRS claims.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIALS AND EXHIBITS
HouseHold is currently in the process of completing their first audit
including the audits of its two acquisitions, PCS, Inc. and Thunderstick, Inc.,
and are therefore not available for the initial report herein. The Company
intends to file its audited financials for fiscal years 1998 and 1999 in an
amended 8-K within sixty (60) days of the date hereof.
Exhibits
2.1 Agreement and Plan of Merger
3.1 Certificate of Incorporation
3.2 Bylaws
10.1 Letter Agreement (stock purchase)
Item 8. CHANGE IN FISCAL YEAR
None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DATE: March 22, 2000
HouseHold Direct.com, Inc.
By: /s/ JOHN D. FOLGER
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John D. Folger
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
2.1 Agreement and Plan of Merger
3.1 Certificate of Incorporation
3.2 Bylaws
10.1 Letter Agreement (stock purchase)
</TABLE>
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EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Agreement") is entered into as
of the 9th day of March, 2000, by and among HouseHold Direct.com, Inc., a
Delaware corporation ("HHD") and Cross Check Corp., a Colorado corporation
("Cross")
WHEREAS, HHD is authorized to issue up to 50,000,000 shares of common
stock, $.001 par value ("HHD Common Stock"); and
WHEREAS Cross is authorized to issue up to 50,000,000 shares of common
stock, $.001 par value ("Cross Stock"); of which 3,360 shares are issued and
outstanding; and
WHEREAS the respective Boards of Directors of HHD and Cross believe it
to be in the best interests of their respective corporations and shareholders
for Cross to merge with and into HHD (Cross and HHD sometimes referred to as the
"Constituent Corporations") upon the terms and conditions herein contained; and
in connection therewith have each adopted, approved and authorized the execution
and delivery of this Agreement and Plan of Merger (the "Agreement"); and
WHEREAS, the Board of Directors of Cross has submitted this Agreement
and the subject merger to its shareholders for approval as required by the
corporate law of the State of Colorado.
NOW THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants and agreements herein contained, the
parties hereto do hereby agree as follows:
I. MERGER
1.01 EFFECTIVE TIME. The merger contemplated by this Agreement shall be
effective on the date and time that the Certificate of Merger is filed with the
Secretary of State of the State of Delaware (the "Effective Time").
1.02 MERGER. Upon the terms and subject to the conditions set forth in
this Agreement, and in accordance with the General Corporation Law of the State
of Delaware (the "GCL"), Cross shall be merged with and into HHD at the
Effective Time (the "Merger").
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As of the Effective Time, the separate corporate existence of Cross shall cease
and HHD shall continue as the surviving corporation (the "Surviving
Corporation") and shall succeed to and assume all the rights and obligations of
Cross in accordance with the GCL. Without limiting the generality of the
foregoing:
(a) HHD, as the surviving corporation shall continue its corporate
existence under the laws of the State of Delaware and shall possess all of the
rights, privileges, immunities, powers, franchises and authority (both public
and private) of, and be subject to all of the restrictions, disabilities and
duties of, HHD and Cross;
(b) all of the assets and property of Cross of every kind, nature and
description (real, personal and mixed and both tangible and intangible) and
every interest therein, wheresoever located, including without limitation all
debts or other obligations belonging or due to Cross, all stock subscriptions,
claims and chooses in action shall be and be deemed to be vested, absolutely and
unconditionally in HHD (to the same extent, degree and manner as previously
vested in Cross);
(c) all debts and obligations of Cross, all rights of creditors of
Cross and all liens encumbering any of the property of Cross vested in HHD
shall remain in full force and effect without modification or impairment and
shall be and be deemed to be enforceable against HHD and its assets and
properties with the same full force and effect as if such debts, obligations or
liens had been originally incurred or created by HHD in its own name and for
its own behalf.
1.03 CLOSING. Subject to the satisfaction or waiver of the last of the
conditions set forth in Article VI hereof, the closing of the Merger will take
place at 10:00 am on March ____, 1999, at the offices of HHD at 900 Main Street
South, Southbury, Connecticut or at such other time and place as the parties to
this Agreement shall agree (the "Closing Date"). Subject to the terms and
conditions of this Agreement, on the Closing Date: (a) the parties hereto shall
each deliver to the other the documents, agreements, payments and consideration
required to be delivered by each to the other party hereto as herein expressly
provided and (b) the Constituent Corporations shall execute two originals of a
Certificate of Merger in the forms required for filing with the Secretary's of
State of Delaware and Colorado, which Certificates of Merger shall be filed by
the parties with the Secretary's of State of Delaware and Colorado immediately
after execution on the Closing Date. Subsequent to the Closing the parties
hereto shall thereafter execute, acknowledge, deliver and/or record such other
and further instruments, documents or certificates and/or take an perform such
other and further actions as may be required to effect and/or implement the
merger.
1.04 NAME. The name of the Surviving Corporation shall be "HouseHold
Direct.com, Inc."
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1.05 CONSTITUTIONAL DOCUMENTS, DIRECTORS AND OFFICERS. On and as of the
Effective Time:
(a) The Certificate of Incorporation of HHD on such date in
full force and effect shall be the Certificate of Incorporation of HHD, as the
surviving corporation, until the same shall be altered, amended, modified,
terminated or rescinded in the manner provided by the GCL; which rights of
alteration, amendment, modification, termination and/or rescission are hereby
expressly reserved by HHD;
(b) The By-Laws of HHD on such date in full force and effect,
shall be the By-Laws of HHD, as the surviving corporation, until the same shall
be altered, amended, modified, terminated or rescinded in the manner provided in
the Certificate of Incorporation and/or the GCL; which rights of alteration,
amendment, modification, termination and/or rescission are hereby expressly
reserved by HHD;
(c) The members of the Board of Directors, and the officers of
HHD, the Surviving Corporation, shall consist of the directors and officers of
HHD immediately prior to the Effective Time; each to serve in such capacity
until the earlier of their resignation or removal or until their successors are
duly elected and qualified.
1.06 PRINCIPAL OFFICE. The principal office of the Surviving
Corporation shall be the principal office of HHD as of the Effective Time,
which is 900 Main Street South, Southbury, Ct.
II. EFFECT OF MERGER ON CAPITAL STOCK OF CONSTITUENT CORPORATIONS
- EXCHANGE OF CERTIFICATES
2.01 CONVERSION OF CAPITAL STOCK OF CROSS. As of the Effective Time,
the shares of Cross Stock shall be converted and exchanged into shares of HHD
Common Stock and cash consideration in the following manner:
(a) Each issued and outstanding share of Cross Stock shall, by
virtue of the merger and without any action on the part of the holder thereof,
be converted and exchanged into 30.30 fully paid and nonassessable share of HHD
Common Stock;
(b) After the Effective Time, each holder, other than a
Dissenting Shareholder, of an outstanding certificate which prior to the
Effective Time represented shares of Cross Stock shall surrender such
certificate ("Old Certificate") to HHD, and such holder shall be entitled upon
such surrender to receive in exchange therefor a certificate for that number of
shares of HHD Common Stock which such holder is entitled to receive under
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Section 2.01(a)(i) of this Agreement. Until surrendered as contemplated by
this sub-section, each Old Certificate for shares of Cross Stock shall be deemed
at all times after the Effective Time to represent and evidence (for all
corporate purposes) that number of shares of HHD Common Stock into which the
shares of Cross Stock theretofore represented by such Old Certificate shall have
been converted pursuant to Section 2.01(a)(i) hereof. From and after the
Effective Time the sole rights of the holders of Old Certificates representing
shares of Cross Stock shall be those to which they are entitled as owners of
HHD Common Stock into which the shares of Cross Stock evidenced by such Old
Certificates have been converted as herein provided;
(c) Upon the issuance of the HHD Common Stock to the
shareholders of Cross as herein provided in exchange for their shares of Cross
Stock, there shall be credited to the capital accounts of HHD an amount equal
to the fair market value of the shares of HHD Common Stock so issued; and
of the amount so credited, the portion thereof in excess of the aggregate par
value thereof shall be credited to the capital surplus account.
(d) Notwithstanding anything in this Agreement to the
contrary, any issued and outstanding shares of Cross Stock held by a person who
complies with all of the provisions of Colorado law concerning the rights of
holders of Cross Stock to object to the Merger and require appraisal of their
shares ("Dissenting Shares" and "Dissenting Shareholders", as the case may be)
shall not be converted as described in Section 2.01(a) but shall, instead
entitle the holder thereof to receive such consideration as may be determined to
be due to such Dissenting Shareholder pursuant to Colorado law. If, after the
Effective Time, such Dissenting Shareholder withdraws his demand for appraisal
or fails to perfect or otherwise loses his right of appraisal pursuant to
Colorado law, each of his shares shall be deemed to be converted as of the
Effective time into the HHD Common Stock specified in Section 2.01(a).
III. REPRESENTATIONS AND WARRANTIES OF HHD
In order to induce Cross to execute and perform this Agreement, HHD
does hereby represent, warrant, covenant and agree (which representations,
warranties, covenants and agreements shall be and be deemed to be continuing and
survive the execution and delivery of this Agreement, the Closing and the
Effective Time) as follows:
3.01 ORGANIZATION AND QUALIFICATION
(a) HHD is a corporation duly organized, validly existing, and
in good standing under the laws of Delaware, with all requisite power and
authority to own, lease, license, and use its properties and assets and to carry
on the business in which it is now
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engaged. HHD is duly qualified to transact the business in which it is engaged
and is in good standing as a foreign corporation in every jurisdiction in which
its ownership, leasing, licensing, or use of property or assets or the conduct
of its business makes such qualification necessary.
(b) HHD has furnished to Cross its Certificate of
Incorporation and By-Laws, as presently in effect, certified by the Secretary of
the corporation. HHD is not in material violation or breach of, or in default
with respect to, any term of its Certificate of Incorporation or By-Laws.
3.02 CAPITALIZATION The authorized capital stock of HHD consists of
50,000,000 shares of HHD Common Stock of which 21,774,303 shares were issued
and outstanding as of January 11, 2000.
3.03 AUTHORITY HHD has all requisite power and authority to execute,
deliver, and perform this Agreement. All necessary corporate proceedings of
HHD have been or as of the Effective Time will have been duly taken to
authorize the execution, delivery, and performance of this Agreement by HHD.
This Agreement has been duly authorized, executed, and delivered by HHD,
constitutes the legal, valid, and binding obligation of, HHD, and is
enforceable as to HHD in accordance with its terms subject, as to
enforcement of remedies, to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the rights of creditors generally and the
discretion of courts in granting equitable remedies. Except for the provisions
of the GCL governing the filing of the Certificate of Merger, no consent,
authorization, approval, order, license, certificate, or permit of or from, or
declaration or filing with, any federal, stare, local, or other governmental
authority or any court or other tribunal is required by HHD for the execution,
delivery, or performance of this Agreement by HHD.
3.04 HHD COMMON STOCK All of the shares of HHD Common Stock to be
issued by HHD pursuant to this Agreement shall be and be deemed to be duly and
validly authorized and, when issued to the shareholders of Cross in exchange for
their Cross Stock, duly and validly issued, fully paid and nonassessable and
free and clear of all federal and state issuance, stock and/or company taxes,
liens, claims, encumbrances and charges.
3.05 CERTIFICATE The representations, warranties, covenants and
agreements of HHD contained in this Agreement, including, without
limitation, those contained in this Article III, are true, accurate and correct
in all respects as of the date hereof and shall be true, accurate and correct
and complete, in all respects, as of the Closing; and at the Closing HHD shall
deliver to Cross a certificate, executed by the chief executive officer of
HHD remaking, on behalf of HHD, each of the representations, warranties,
covenants and agreements of HHD set forth in this Agreement, including without
limitation, those set forth in this Article III hereof.
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IV. REPRESENTATIONS AND WARRANTIES OF CROSS
In order to induce HHD to execute and perform this Agreement, Cross does
hereby represent, warrant, covenant and agree (which representations,
warranties, covenants and agreements shall be and be deemed to be continuing and
survive the execution and delivery of this Agreement, the Closing and the
Effective Time) as follows:
4.01 ORGANIZATION AND GOOD STANDING Cross is a corporation duly organized,
validly existing and in good standing under the laws of the State of Colorado
with full power and authority to own or lease its properties and to carry on its
business as presently being conducted and enter into and perform each of the
transactions, covenants and agreements provided for in this Agreement.
4.02 EXECUTION AND PERFORMANCE AUTHORIZED The execution, delivery and
performance of this Agreement and all other documents and related agreements
contemplated hereunder, have been duly approved by Cross's board of directors
and shareholders; such execution and delivery and the consummation by Cross of
the transactions, covenants and agreements contemplated hereunder have been duly
authorized by the taking of all necessary corporate action; and no further
action is required to be taken by law and/or pursuant to the certificate of
incorporation, by-laws or otherwise of Cross to authorize the execution,
delivery and/or performance of this Agreement, and/or the taking of all action
required to be taken by Cross with respect to this Agreement and the
consummation of the transactions and performance of this Agreement and the other
agreements contemplated hereunder. The Agreement and the other documents
contemplated hereunder, are valid and binding and fully enforceable against
Cross in accordance with their respective terms, subject, as to enforcement of
remedies, to applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the rights of creditors generally and the discretion of
courts in granting equitable remedies. No consent, authorization, approval,
order, license, certificate, or permit of or from, or declaration or filing
with, any federal, state, local, or other governmental authority or any court or
other tribunal is required by Cross for the execution, delivery, or performance
of this Agreement and the other agreements referred to herein.
4.03 ABSENCE OF LITIGATION There is no action, lawsuit, proceeding or
investigation of any kind or nature pending or, to its knowledge, threatened
against Cross before any court, tribunal or administrative agency or board which
it reasonably expects, individually or in the aggregate, to materially and
adversely: (a) affect the solvency of Cross, (b) affect its ability to perform
hereunder, or (c) render any one or more of this Agreement and/or any of the
agreements referred to herein and/or the transactions contemplated hereunder
void or voidable.
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4.04 NO OTHER DEFAULT The execution and delivery of this Agreement and the
other agreements referred to herein, and the consummation of the transactions
contemplated hereunder will not conflict with or violate or require any consent
under and will not result in any breach or termination of certificate of
incorporation or by-laws of Cross, or any other agreement to which Cross is a
party or by which its properties are subject or by which it is bound. Cross is
not in violation of, or in default under, (i) any term or provision of its
constitutional documents; (ii) any material term or provision or any financial
covenant of any indenture, mortgage, contract, commitment or other agreement or
instrument to which it is a party or by which it or any or its properties or
business is or may be bound or affected; or (iii) any existing applicable law,
rule, regulation, judgment, order or decree of any governmental agency or court,
domestic or foreign, having jurisdiction over it or any of its properties or
business. Cross owns, possesses or has obtained all governmental and other
licenses, permits, certifications, registrations, approvals or consents and
other authorizations necessary to own or lease, as the case may be, and to
operate its properties and to conduct its business or operations as presently
conducted and all such governmental and other licenses, permits, certifications,
registrations, approvals, consents and other authorizations are outstanding and
in good standing, and there are no proceedings pending or, to the best of its
knowledge, threatened, or any basis therefor existing, seeking to cancel,
terminate or limit such licenses, permits, certifications, registrations,
approvals or consents or authorizations, or related to the breach or failure to
comply of Cross with any law, rule, regulation, judgment, order or decree;
4.05 PERMITS AND FILINGS Except for the filing of the Certificate of
Merger, there is no requirement applicable to Cross to make any further filing
with, or to obtain any permit, authorization, consent or approval of, any
governmental or other regulatory authority as a condition of the lawful
consummation of the transactions contemplated under this Agreement.
4.06 CORPORATE DOCUMENTS Cross has furnished to HHD true, correct and
complete copies of its certificate of incorporation, by-laws and minute book,
and a certificate of good standing from the State of Colorado dated within
thirty (30) days of the Closing Date. The minute book contains a record, which
is complete and accurate in all material respects, of all meetings and all
corporate actions of the shareholders and Board of Directors of Cross. Cross is
not in material violation or breach of; or in default with respect to, (a) any
term of its constitutional documents or any agreement to which it is a party or
by which its assets are bound, or (b) any law, rule, regulation, judgment, order
or decree of any governmental agency or court having jurisdiction over it or its
assets.
4.07 CAPITALIZATION The authorized capital stock of Cross consists of 5,000
shares of common stock ("Cross Stock") of which 3,360 shares are issued and
outstanding ("Outstanding Cross Stock"). The shares of Outstanding Cross Stock
are duly authorized, validly issued, fully paid, and nonassessable. There are no
commitments, plans, arrangements to issue, options, warrants, security, or
other rights calling for the issuance of, any shares of
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capital stock or other ownership interest in Cross or any security or other
instrument convertible into, exercisable for, or exchangeable for capital stock
of or ownership in Cross.
4.8 FINANCIAL STATEMENTS AND CONDITION
(a) Cross has delivered to HHD a true, correct and complete
copy of its Form 10-SB dated December 15, 1999 ("Registration Statement") filed
pursuant to the Securities Exchange Act of 1934, as amended (the "34 Act") which
contains therein the audited balance sheet, statement of income, statement of
retained earnings, and statement of cash flows of Cross for the fiscal year
ended August 31, 1999 (the "Audited Financial Statements").
(b) At or prior to the Closing, Cross shall have filed its Form
10Q for the period ended November 30, 1999 including unaudited financial
statements ("Interim Statements", the Audited Financial Statements and Interim
Statements collectively the "Financial Statements").
(c) The Financial Statements were prepared in accordance with
generally accepted accounting principles ("GAAP") consistently applied
throughout the period involved, are true, correct and complete in all material
respects, are in accordance with the books and records of Cross and fairly
present (and will fairly present) together with the notes thereto, the financial
position and results of operations of Cross for the periods therein indicated.
(d) Since the dates of the Financial Statements, there have not
been, nor prior to the Closing will there be, any material adverse changes in
the business or condition, financial or otherwise, of Cross.
4.09 TAX AND OTHER LIABILITIES Cross has no liability of any nature,
accrued, absolute or contingent, secured or unsecured including without
limitation liabilities for payroll and other employee taxes, federal, state,
local, or foreign taxes or liabilities to customers or suppliers, other than
liabilities which are reflected on the Financial Statement. Except for the
liabilities included on the Financial Statement, as of the date of such
Financial Statement, Cross had no liabilities, either fixed or contingent, which
would have been required to be recorded under GAAP as of such date, and to the
knowledge of Cross no such liabilities, other than liabilities arising in the
ordinary course of business and/or pursuant to this Agreement have accrued
and/or will accrue between such date and the Effective Time. Cross has filed all
federal, state, municipal and local tax returns (whether relating to income,
sales, franchise, withholding, real or personal property or otherwise) required
to be filed under the laws of the United States and all applicable states, and
has paid in full all taxes which are due pursuant to such returns or claimed to
be due by any taxing authority or otherwise due and owing. No penalties or other
charges are or will become due with respect to the late filing of any such
return. To the best of the knowledge of Cross, after due investigation, each
such tax return
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<PAGE> 9
heretofore filed by Cross correctly and accurately reflects the amount of its
tax liability thereunder. Cross has withheld, collected and paid all other
levies, assessments, license fees and taxes to the extent required and, with
respect to payments, to the extent that the same have become due and payable;
4.10 LITIGATION AND CLAIMS There is no litigation, arbitration, claim,
governmental or other proceeding (formal or informal), or investigation pending
or, or to the knowledge of Cross threatened, with respect to Cross or any of its
business, properties, or assets.
4.11 PROPERTIES As of the Effective Time, Cross will have good title to all
properties and assets used in its business or owned by it free and clear of all
liens, claims, mortgages, security interests, pledges, charges, and
encumbrances.
4.12 CONTRACTS AND OTHER INSTRUMENTS Cross is not a party to nor it or its
assets bound by any agreement of any kind, nature or description except as set
forth in the Registration Statement. Cross is not in breach or violation of or
default under any contract or instrument to which Cross is a party and/or by
which its assets are bound; and no event has occurred which with the lapse of
time or action by a third party could result in a breach or violation of or
default by Cross under any contract or other instrument to which Cross is a
party of by which it or any of its assets are bound or affected, nor is there
any court or regulatory order pending against or affecting Cross and/or any of
its assets. Cross is not a party to any agreement performable in the future
4.13 EMPLOYEES Cross has no employees and no welfare benefit plans (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974
("ERISA") or otherwise of any kind, nature or description.
4.14 PRE CLOSING ACTIVITY Cross shall not enter into or consummate any
transactions prior to the Closing other than in the ordinary course of business
and will pay no dividend, or increase the compensation of any officer, director
or employee and will not enter into any transaction or agreement which would
adversely affects its financial condition. Cross shall deliver to HHD at or
prior to the Closing copies of any and all reports relating to the financial
and/or business condition of Cross which are created or published subsequent to
the date hereof together with any reports or communications sent to the
stockholders of Cross subsequent to the date hereof.
4.15 ACCURACY No statement, representation or warranty contained herein, in
any certificate delivered pursuant to this Agreement, the Registration Statement
and/or in any report filed with the Securities Exchange Commission (the
"Commission") contains or will contain any untrue statement of a material fact
or omits to state any material fact necessary to make such statement,
representation or warranty not misleading.
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<PAGE> 10
4.16 FILINGS Cross has delivered (or will deliver, prior to the Closing) to
HHD true, correct and complete copies of the Registration Statement (including
exhibits) together with each of its other reports to shareholders and filings
with the Commission for the year ended December 31,1999 and through the date of
the Closing. Cross has duly and timely filed (and will, prior to the Closing
duly and timely file) all reports required to be filed by it under the
Securities Act of 1933, as amended ("33Act") and the 34 Act (collectively the
"Federal Securities Laws"). None of the foregoing reports nor any reports sent
to the shareholders of Cross contained any untrue statement of material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements in such reports, in light of the circumstances under which
they were made, not misleading.
4.17 BOARD ACTION During the period from the date hereof until the Closing
there shall not be taken an action by the Board of Directors of Cross without
the prior written consent of HHD in each instance.
4.18 PURCHASE FOR INVESTMENT PURPOSES ONLY The shareholders of Cross are
acquiring the HHD Common Stock as a result of the Merger for investment
purposes only and not with the view to the resale or distribution thereof. Each
of the shareholders of Cross is an "accredited investor" under the regulations
promulgated under the 33Act or otherwise meets one of the definitions for
persons entitled to acquire unregistered securities pursuant to an exemption
from registration under the 33Act. Neither Cross nor its shareholders have
received and/or relied upon any representations or warranties from HHD other
than those contained in this Agreement and the attached schedules or exhibits
hereto. Cross represents and warrants that it and its shareholders have such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of its investment in HHD Common Stock. Cross
and its shareholders understand and acknowledge that the HHD Common Stock has
not been registered under the Act or under any state securities act and are
being issued to the shareholders of Cross pursuant to an exemption from
registration under the Act. The reliance by HHD upon such exemption is
predicated upon the representations and warranties of Cross contained herein. In
this regard, Cross and its shareholders understand and agrees that there may be
affixed to the certificates representing the shares of HHD Common Stock
acquired by the shareholders of Cross hereunder a legend advising of the
unregistered, restricted nature of the shares.
4.19 CERTIFICATE The representations, warranties, covenants and agreements
of Cross contained in this Agreement, including, without limitation, those
contained in this Article IV, are true, accurate and correct in all respects as
of the date hereof and shall be true, accurate and correct and complete, in all
respects, as of the Closing; and at the Closing Cross shall deliver to HHD a
certificate, executed by the chief executive officer of Cross remaking, on
behalf of Cross each of the representations, warranties, covenants and
agreements set forth in this Agreement, including without limitation, those set
forth in this Article IV hereof.
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<PAGE> 11
V. COVENANTS AND OTHER AGREEMENTS
5.01 CONDUCT OF BUSINESS OF CROSS Except as herein expressly
provided to the contrary or as otherwise agreed to in writing by
HHD, during the period from the execution of this Agreement until
the earlier to occur of the Effective Time or the termination of this
Agreement as herein provided, Cross will conduct its operations
according to its ordinary and usual course of business and consistent
with past practice. In this regard, except as expressly provided in
this Agreement to the contrary or otherwise agreed to by HHD in
writing or as required by law or agreement, Cross will not, between
the date of this Agreement and the earlier to occur of the Effective
Time or the termination of this Agreement as herein provided:
(a) Make or become obligated to make, any payment to any
director, officer, employee, or agent;
(b) Declare any dividend or make any other distribution
to shareholders;
(c) Incur any indebtedness for borrowed money except in
the ordinary course of business;
(d) Sell, lease, license, encumber or dispose of any
material portion of its properties or assets except in the ordinary
course of business;
(e) Expend funds for any individual capital expenditure
in excess of $5,000 or aggregate capital expenditures in excess of
$30,000;
(f) Issue any shares of capital stock, modify or
reorganize its equity capitalization or grant any option or other
right to acquire any shares of its capital stock;
(g) Amend its certificate of incorporation or by-laws.
(h) Change its business, operations or financial
condition, or the manner of managing or conducting its business and
operations if such changes, if any, have a material adverse effect on
such business, operations or financial condition, taken as a whole;
(i) Change its accounting methods or practices
(including, without limitation, any change in depreciation,
amortization and/or good will policies or rates;
(j) Incur any damage, destruction or loss (whether or
not covered by insurance) which materially and adversely affects its
assets, business, operations or financial condition;
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<PAGE> 12
(k) Make any loan to any person or entity and/or issue
any guaranty for or with respect to its own or another's obligations;
or
(l) Waive or release any right or claim;
5.02 TRANSACTION COSTS AND EXPENSES Each of the parties
hereto shall pay its own respective costs incurred in connection with
this transaction including, without limitation, all legal,
accounting, auditing and appraisal fees in negotiating and preparing
this Agreement and in consummating, closing and implementing the
transactions contemplated hereby.
5.03 SUBSEQUENT EVENTS Each of the parties hereto shall
promptly advise the other parties hereto, in writing of (a) the
occurrence of any event which renders any of the representations or
warranties of such party set forth herein inaccurate in any material
respect, and (b) the failure of such party to comply with or
accomplish, in any material respect, any of the covenants or
agreements of such party set forth herein.
5.04 INDEMNITY
(a) Cross does hereby agree to indemnify and hold
harmless HHD and its employees, officers, directors and successors
against and in respect of any and all claims, suits, actions,
proceedings (formal or informal), governmental investigations,
judgments, deficiencies, set-offs, damages, settlements, liabilities,
and reasonable legal and other expenses (including reasonable
attorneys' fees and defense costs) as and when incurred arising out
of or based upon any breach by Cross of any representation, warranty,
covenant, or agreement of Cross contained in this Agreement;
(b) HHD does hereby agree to indemnify and hold
harmless Cross and its employees, officers, directors and successors
against and in respect of any and all claims, suits, actions,
proceedings (formal or informal), governmental investigations,
judgments, deficiencies, set-offs, damages, settlements, liabilities,
and reasonable legal and other expenses (including reasonable
attorneys' fees and costs of defense) as and when incurred arising
out of or based upon any breach of any representation, warranty,
covenant, or agreement of HHD contained in this Agreement.
(c) The parties' respective indemnity obligations
hereunder shall be subject to the following terms, limitations and
conditions:
(i) A person claiming the right to indemnity
coverage under this Section 5.04 ("indemnitee") shall give
the party from whom he or it seeks indemnity coverage
("indemnitor") prompt notice of the assertion of any
indemnified claim on the basis of which an indemnitee
intends to seek indemnification from an indemnitor as
provided herein; provided, however, that the obligation of an
indemnitor shall be
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reduced for the failure to give timely notice at any
particular time only to the extent that the indemnitor has
been actually prejudiced thereby;
(ii) The indemnitor shall have the duty to
zealously and competently defend, with counsel selected by
indemnitor after consultation with the primary indemnitee,
any matter subject to indemnity coverage under subparagraphs
(a) or (b) of this section and to pay all costs of such
defense. In any case where indemnitor's obligation to provide
a zealous defense is compromised by conflict of interest
between itself and an indemnitee or between indemnitees, the
indemnitor shall, upon the request of an indemnitee, provide
separate legal representation to obviate the conflict of
interest. When indemnitor has assumed the defense obligations
of this section, indemnitor shall have the right to settle
the matter without the indemnitees' consent, provided
indemnitor in fact commits sufficient funds to satisfy the
settlement in full. In the event that an indemnitor fails to
defend as provided in this section, any indemnitee shall have
the right (but not the obligation) to select and be
represented by counsel of its choice, to manage its own legal
representation or defense and to settle any claim, debt or
other indemnified matter hereunder, and the indemnitor shall
be liable to such indemnitee for all costs, expenses, damages
and settlements incurred by such indemnitee;
(iii) With respect to any claim for which an
indemnitor shall indemnify any indemnitee, the indemnitor
shall be subrogated to all rights of any indemnitee against
any and all third parties up to the amount paid by indemnitor
to indemnitees or set off by such indemnity against an
indemnitor;
(iv) No indemnitor shall be liable for that
portion of any claim for which an indemnitee actually
receives from any insurance, the defense, cost of defense or
insurance proceeds covering such claim (the deductible
pertaining to any such insurance shall not be considered to
be insurance proceeds or cost of defense).
5.05 RELATED AGREEMENTS Each of the parties shall execute and
deliver at Closing the related agreements, instruments and documents
specified for delivery at Closing or the Effective Time in Sections
6.02 and 6.03 and elsewhere in this agreement or in a related
agreement to which each, respectively, is a party.
5.6 CROSS LIABILITIES Prior to the Closing Cross shall have
paid in full any and all liabilities of Cross of every kind, nature
and description.
5.7 INSPECTION At all times prior to the Closing, during
normal business hours an upon reasonable notice, each party will
permit the other to examine its books and records and the books and
records of its subsidiaries, to discuss the same with such party's
authorized representative and to make copies thereof and abstracts
therefrom. It is recognized that each
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<PAGE> 14
party may provide the other with information (including, without
limitation, information contained in its books and records and/or
pursuant to the inspection described in the preceding sentence)
which is confidential or proprietary information. During the period
from the date hereof until the fourth annual anniversary of the
Closing (or the termination of this Agreement if the Merger is
abandoned) the recipient of any such information shall protect such
information from disclosure to persons, other than members of its
own organization and its professional advisers, in the same manner
as it protects its own confidential or proprietary information from
unauthorized disclosure, and not use such information to the
competitive detriment of the disclosing party. In addition if this
Agreement is terminated for any reason, each party shall promptly
return or cause to be returned all documents or other written
records of such confidential or proprietary information, together
with all copies of such writings and, in addition, shall either
furnish or cause to be furnished, or shall destroy, or shall
maintain with such standard of care as is exercised with respect to
its own confidential or proprietary information, all copies of all
documents or other written records developed or prepared by such
party on the basis of such confidential or proprietary information.
No information shall be considered confidential or proprietary if it
is (a) information already in the possession of the party to whom
disclosure is made, (b) information acquired by the party to whom
disclosure is made from other sources, or (c) information in the
public domain or generally available to interested persons or which
at a later date passes into the public domain or becomes available
to the party to whom disclosure is made without any wrongdoing by
the party to whom the disclosure is made.
VI. CONDITIONS
6.01 CONDITIONS TO OBLIGATION TO EFFECT THE MERGER The
respective obligations of each party to consummate the Merger
shall be subject to and conditioned upon the satisfaction at or
prior to the Closing Date of the following conditions:
(a) To the extent required by the GCL and/or Colorado
law or the party's certificate of incorporation or by-laws,
shareholder approval shall have been obtained;
(b) No statute, rule, regulation executive order,
decree, temporary restraining order, preliminary or permanent
injunction or other order issued by any court or competent
jurisdiction or other governmental entity preventing the
consummation of the Merger shall be in effect; provided that each of
the parties shall have used reasonable efforts to prevent the entry
of any such injunction or other order and to appeal as promptly as
possible any injunction or other order that may be entered;
(c) There shall not have occurred or been discovered any
material breach or inaccuracy of any representation or warranty made
by any other party in this Agreement, and
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<PAGE> 15
there shall not have occurred any material breach of any covenant or
obligation required by this Agreement or by law to have been
performed by any other party prior to the Effective Time; and
(d) Each party shall have received all documents and
agreements required to be delivered to it at or before the Closing.
6.02 HHD'S OBLIGATIONS AT CLOSING
(a) At the Closing, HHD shall deliver or cause to be
delivered to Cross, in form satisfactory to Cross, the following;
(i) A true copy of the minutes of the meeting of
HHD's Board of Directors approving the Plan of Merger and the
Merger and authorizing the execution, delivery and performance of
this Agreement;
(ii) A certificate of good standing for HHD issued
within thirty (30) days prior to the Closing Date by the Secretary
of State of Delaware; and
(iii) All other schedules, certificates and other
documents required by this Agreement or by law to be delivered by
HHD) on or before Closing or the Effective Time.
(b) At the Closing, HHD shall deliver or cause to be
delivered to the Exchange Agent (as defined) the consideration (set
forth in Section 2.01(a) hereof) to be received by each holder of
Cross Stock (other than Dissenting Shareholders) who shall have
surrendered to HHD, at or before the Closing his, her or its
certificate representing all shares of Cross Stock owned and/or held
by such shareholders; and the Exchange Agent (as defined) shall,
immediately following the recordation of the Certificates of Merger
in the States of Delaware and Colorado, distribute such
consideration to, or in accordance with the written directions of,
such holders of Cross Stock as their respective interests may
appear. Michael A. Littman, Esq. is hereby designated by the parties
hereto as the Exchange Agent; and by his execution of this
Agreement, Mr. Littman accepts such engagement and agrees to perform
the duties of Exchange Agent as herein set forth.
6.03 CROSS'S OBLIGATIONS AT CLOSING
At or prior to the Closing, Cross shall deliver or cause to
be delivered to HHD, in form satisfactory to HHD, the following:
(a) A true copy of the minutes of the meeting of the
Board of Directors of Cross adopting the Agreement and Plan of
Merger and Merger, recommending the Agreement
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and Plan of Merger and Merger to the shareholders of Cross and
authorizing Cross's execution, delivery and performance of this
Agreement;
(b) A true copy of the notice of shareholders meeting
and proof of service thereof upon all Cross shareholders of record
in accordance with the Colorado law together with the minutes of
the shareholder's meeting evidencing shareholder approval of the
Plan of Merger and the execution, delivery and performance of this
Agreement; or, alternatively, a unanimous written consent executed
by all of the shareholders of Cross containing the foregoing
approvals;
(c) An opinion of counsel to Cross reasonably acceptable
to HHD with respect to such matters and in such form as shall be
reasonably requested by and acceptable to HHD;
(d) Documentary proof reasonably acceptable to HHD that
all of the liabilities of Cross of every kind, nature and
description have been paid in fall as at and through the date of the
Closing;
(e) All of the books and records of Cross;
(f) A certificate of good standing for Cross issued
within thirty (30) days prior to the Closing Date by the Secretary
of State of Colorado; and
(g) All other schedules, certificates and other
documents required by this Agreement to be delivered by Cross on or
before Closing or the Effective Time;
VII. ABANDONMENT
7.01 ABANDONMENT OF MERGER The rights and obligations of
the Constituent Corporations under this Agreement may be terminated
and the Merger abandoned prior to the Effective Time as provided in
the GCL by the mutual agreement of the Board of Directors of both of
the Constituent Corporations.
VIII. MISCELLANEOUS
8.01 BROKERAGE FEES No party to this Agreement has consented
to or authorized any broker or agent to act on its behalf, directly
or indirectly, as a broker or finder in connection with the
transaction contemplated by this Agreement. In the event any claim
is made for a broker's or finder's fee in connection with the
transactions contemplated hereunder, the party
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<PAGE> 17
responsible for retaining or securing said broker or finder shall be
solely responsible for the payment of any broker's or finder's fees
incurred as a result thereof. Further, the responsible party or
parties shall indemnify the other parties against any loss or
liabilities by reason of such broker's or finder's fees.
8.02 FURTHER ACTIONS At any time and from time to time, each
party agrees, at its expense, to take such actions and to execute
and deliver such documents as may be reasonably necessary to
effectuate the purposes of this Agreement.
8.03 SURVIVAL Except as otherwise provided herein, the
covenants, agreements, representations, and warranties contained in
or made pursuant to this Agreement shall survive the Effective Time
and any delivery of consideration at Closing or the Effective Time
irrespective of any investigation made by or on behalf of any
party.
8.04 MODIFICATION This Agreement and the related instruments
and agreements hereto set forth the entire understanding of the
parties with respect to the subject matter hereof, supersede all
existing agreements among them concerning such subject matter, and
may be modified only by a written instrument duly executed by all of
the parties hereto.
8.05 NOTICES All notices, elections, reports or other
correspondence required or permitted hereunder shall be in writing
and deemed to have been properly given or delivered when mailed by
certified mail, return receipt requested, postage prepaid, delivered
by overnight express courier, delivery fees prepaid, or transmitted
by fax with receipt confirmed, to the party to whom directed at the
below specified addresses:
If to HHD: 900 South Main Street
Southbury, Ct.
With a copy to:
Martin J. Gersten, Esq.
90 Birch Hill Road
Newtown, Ct. 06470
If to Cross: 7444 Singing Hills Court
Boulder, Co. 80301
With a copy to:
Michael A. Littman, Esq.
10200 W. 44th Avenue, No. 400
Wheat Ridge, Co. 80033
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Any such notice shall be deemed given thee days after deposit with
the mail, one day following delivery thereof to an overnight express
courier or upon confirmation of receipt when sent by fax. The
address of a party may be changed in accordance with the notice
provisions of this section.
8.06 WAIVER Any waiver by any party of a breach of any
provision of this Agreement shall not operate as or be construed to
be a waiver of any other breach of that provision or of any breach
of any other provision of this Agreement. The failure of a party to
insist upon strict adherence to any term of this Agreement on one
or more occasions will not be considered a waiver, or deprive that
party, of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in
writing.
8.07 BINDING EFFECT The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, and in addition shall inure
to the benefit of the indemnitees and their respective successors,
assigns, heirs, and personal representatives.
8.08 NO THIRD-PARTY BENEFICIARIES This Agreement does not
create, and shall not be construed as creating, any rights
enforceable by any person not a party to this Agreement (except as
provided in Section 8.07).
8.09 SEVERABILITY AND REFORMATION If any provision of this
Agreement is invalid, illegal, or unenforceable, the balance of
this Agreement shall remain in effect, and if any provision is
inapplicable to any person or circumstance, it shall nevertheless
remain applicable to all other persons and circumstances, in either
case unless the result thereof would preclude the consummation in
all material respects of the Merger contemplated by this Agreement
and the associated transactions or result in an unjust modification
of the balance of rights and obligations hereunder. To the extent
provided in this section, a court having jurisdiction of a matter
involving the interpretation of this Agreement shall be authorized
to reform this Agreement to the minimum extent necessary to
accomplish the objectives of this section
8.10 HEADINGS The heading of this Agreement are solely for
convenience of reference and shall be given no effect in the
construction or interpretation of this Agreement.
8.11 GOVERNING LAW To the extent permitted by law, this
Agreement shall be governed by and construed in accordance with the
laws of the state of Delaware, without giving effect to conflict of
laws. To the maximum extent permitted by law and subject to the
provisions of Section 8-14 hereof, any action or proceeding
initiated by any party to this Agreement, any indemnitee or any
other person claiming rights under this Agreement shall be brought
in an appropriate state or federal court in Fairfield County,
Connecticut, and any
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person claiming rights under this agreement consents to the
jurisdiction and proper venue of such forum.
8.12 SEPARATE COUNTERPARTS This Agreement may be executed in
several identical counterparts, each one of which shall be
considered an original and all of which when taken together shall
constitute but one instrument.
8.13 INCORPORATION OF RECITALS, EXHIBITS AND SCHEDULES All
related instruments and agreements executed in connection herewith
are incorporated herein by this reference and expressly made a part
of this Agreement.
8.14 ARBITRATION Except in cases where the remedy of
preliminary injunction is reasonably sought by a party because of
the irreparability and immediacy of the harm alleged to be caused or
threatened, in the event there shall arise any dispute or claim in
law or equity arising out of this Agreement or any breach thereof or
any resulting transaction between the parties under this Agreement
and if such dispute cannot be resolved through negotiation, the
parties agree that such dispute shall be submitted to arbitration
under the rules and regulations of the American Arbitration
Association then obtaining. The arbitration shall be held in
Stamford Connecticut, before a single arbitrator.
IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date of the day and year first above written.
HouseHold Direct.com, Inc.
By /s/ JOHN FOLGER
-----------------------------------
John Folger, President
Cross Check Corp.
By /s/ JAMES TOOT
-----------------------------------
James Toot, President
The undersigned, Michael A. Littman agrees to serve as Exchange
Agent in accordance with the terms and conditions of this
Agreement.
/S/ MICHAEL A. LITTMAN
- -----------------------------------
Michael A. Littman
19
<PAGE> 1
EXHIBIT 3.1
[STAMP]
STATE OF DELAWARE
CERTIFICATE OF INCORPORATION
A STOCK CORPORATION
FIRST: The name of this Corporation is Household Direct, Inc.
SECOND: Its Registered Office in the State of Delaware is to be located at 201
North DuPont Parkway in the City of New Castle, County of New Castle. The zip
code is 19720. The name of the Registered Agent therein and in charge thereof
upon whom process against this Corporation may be served, is Delaware
Intercorp, Inc.
THIRD: The nature of the business and the objects and purposes proposed to be
transacted, promoted and carried on, are to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware.
FOURTH: The amount of stock authorized is Twenty Million (20,000,000) shares at
One Penny ($0.01) par value each.
FIFTH: The name and mailing address of the incorporator are as follows:
Name: Alan R. Coffey
Mailing Address: 201 North Dupont Parkway, New Castle, DE 19720
SIXTH: The directors of the corporation are not liable to either the
corporation or its stockholders for monetary damages for a breach of fiduciary
duties unless the breach involves: a) a director's duty of loyalty to the
corporation or its stockholders; b) intentional misconduct or violation of law;
c) a transaction from which the director derived an improper personal benefit;
or d) liability for unlawful payments of dividends or unlawful stock purchases
or redemption by the corporation.
I, The Undersigned, for the purpose of forming a corporation under the laws of
the State of Delaware, do make, file and record this Certificate, and do
certify that the facts herein stated are true, and I have accordingly hereunto
set my hand this twenty third day of March, AD 1999.
/s/ ALAN R. COFFEY
- ---------------------------
Incorporator: Alan R. Coffey
<PAGE> 2
[Stamp] AMENDMENT OF CERTIFICATE OF INCORPORATION
(BEFORE PAYMENT OF CAPITAL OR ISSUANCE OF STOCK)
I, John Folger, and I, Ann Jameson, certify that:
1. They constitute the Board of Directors of Household Direct,
Inc., a Delaware corporation.
2. The original Articles were filed in the Office of the
Secretary of State on March 23, 1999.
3. As of the date of this certificate, no stock of the
corporation has been issued.
4. They hereby adopt the following amendments to the articles
of incorporation of this corporation:
ARTICLE 1 is amended to read as follows:
"FIRST: The name of the Corporation shall be HouseHold
Direct.com, Inc."
ARTICLE 4 is amended to read as follows:
"FOURTH: The aggregate number of shares which the corporation
shall have authority to issue shall consist of 50,000,000 shares of
Common Stock having a $.001 par value. The Common Stock of the Company
may be issued from time to time without prior approval by the
stockholders. The Common Stock may be issued for such consideration
as may be fixed from time to time by the Board of Directors."
The undersigned members of the Board of Directors of the corporation do
hereby certify that the within amendment was duly and properly adopted
in accordance with the provisions of Section 241 of the General
Corporation Law of the State of Delaware and that the corporation has
not received any payment for any of its stock.
DATED: June 22, 1999
By: /s/ JOHN FOLGER By: /s/ ANN JAMESON
-------------------------- --------------------------
John Folger, Director Ann Jameson, Director
This instrument was acknowledged This instrument was acknowledged
before me on this 22 day of before me on this 22 day of
June, 1999, by John Folger. June, 1999 by Ann Jameson.
/s/ DANIELLE M. BOURDEAU /s/ DANIELLE M. BOURDEAU
-------------------------- --------------------------
(NOTARY PUBLIC SIGNATURE) (NOTARY PUBLIC SIGNATURE)
DANIELLE M. BOURDEAU DANIELLE M. BOURDEAU
NOTARY PUBLIC NOTARY PUBLIC
MY COMMISSION EXPIRES SEPT. 30, 2003 MY COMMISSION EXPIRES SEPT. 30, 2003
<PAGE> 1
EXHIBIT 3.2
BYLAWS
OF
HOUSEHOLD DIRECT.com, INC.
ADOPTED AND EFFECTIVE
JUNE 22, 1999
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TABLE OF CONTENTS
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ARTICLE I ............................................................................................... 1
OFFICES.................................................................................................. 1
SECTION 1.1 REGISTERED OFFICE................................................................. 1
SECTION 1.2 OTHER OFFICES..................................................................... 1
ARTICLE II............................................................................................... 1
MEETINGS OF STOCKHOLDERS................................................................................. 1
SECTION 2.1 PLACE OF MEETINGS................................................................. 1
SECTION 2.2 ANNUAL MEETING.................................................................... 1
SECTION 2.3 SPECIAL MEETINGS.................................................................. 1
SECTION 2.4 QUORUM........................................................................... 1
SECTION 2.5 VOTING........................................................................... 2
SECTION 2.6 LIST OF STOCKHOLDERS ENTITLED TO VOTE............................................ 2
SECTION 2.7 STOCK LEDGER..................................................................... 2
SECTION 2.8 RECORD DATE...................................................................... 2
SECTION 2.9 CONDUCT OF MEETINGS BY PRESIDING PERSON.......................................... 3
SECTION 2.10 NOMINATION OF DIRECTORS.......................................................... 4
SECTION 2.11 STOCKHOLDER PROPOSALS REGARDING AMENDMENTS TO CERTIFICATE OF INCORPORATION....... 5
SECTION 2.12 STOCKHOLDER ACTION BY WRITTEN CONSENT............................................ 6
ARTICLE III.............................................................................................. 6
DIRECTORS............................................................................................... 6
SECTION 3.1 NUMBER AND ELECTION OF DIRECTORS................................................. 6
SECTION 3.2 VACANCIES........................................................................ 6
SECTION 3.3 DUTIES AND POWERS................................................................ 6
SECTION 3.4 MEETINGS.......................................................................... 6
SECTION 3.5 QUORUM........................................................................... 7
SECTION 3.6 ACTION OF BOARD.................................................................. 7
SECTION 3.7 MEETINGS BY MEANS OF CONFERENCE TELEPHONE........................................ 7
SECTION 3.8 COMPENSATION..................................................................... 7
SECTION 3.9 INTERESTED DIRECTORS............................................................. 7
SECTION 3.10 REMOVAL.......................................................................... 8
ARTICLE IV.............................................................................................. 9
COMMITTEES.............................................................................................. 9
SECTION 4.1 COMMITTEES....................................................................... 9
SECTION 4.2 COMMITTEE RULES................................................................... 10
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ARTICLE V................................................................................................ 10
OFFICERS................................................................................................. 10
SECTION 5.1 GENERAL........................................................................... 10
SECTION 5.2 ELECTION.......................................................................... 10
SECTION 5.3 CHAIRMAN OF THE BOARD OF DIRECTORS................................................ 10
SECTION 5.4 PRESIDENT......................................................................... 11
SECTION 5.5 VICE PRESIDENTS................................................................... 11
SECTION 5.6 ABSENCE OF OFFICERS............................................................... 11
SECTION 5.7 SECRETARY......................................................................... 11
SECTION 5.8 TREASURER......................................................................... 12
SECTION 5.9 CONTROLLER........................................................................ 12
SECTION 5.10 ASSISTANT SECRETARIES............................................................. 12
SECTION 5.11 ASSISTANT TREASURERS.............................................................. 13
SECTION 5.12 OTHER OFFICERS.................................................................... 13
ARTICLE VI............................................................................................... 13
STOCK.................................................................................................... 13
SECTION 6.1 CERTIFICATES EVIDENCING SHARES.................................................... 13
SECTION 6.2 TRANSFER AGENT.................................................................... 13
SECTION 6.3 SIGNATURES........................................................................ 13
SECTION 6.4 LOST CERTIFICATES................................................................. 13
SECTION 6.5 TRANSFERS......................................................................... 14
ARTICLE VII.............................................................................................. 14
NOTICES.................................................................................................. 14
SECTION 7.1 NOTICES........................................................................... 14
SECTION 7.2 WAIVERS OF NOTICE................................................................. 14
ARTICLE VIII............................................................................................. 14
INDEMNIFICATION.......................................................................................... 14
SECTION 8.1 GENERAL........................................................................... 14
SECTION 8.2 EXPENSES RELATED TO PROCEEDINGS................................................... 15
SECTION 8.3 ADVANCEMENT OF EXPENSES........................................................... 15
SECTION 8.4 REQUEST FOR INDEMNIFICATION....................................................... 15
SECTION 8.5 DETERMINING ENTITLEMENT OF INDEMNIFICATION IF NO CHANGE OF
CONTROL........................................................................... 15
SECTION 8.6 DETERMINING ENTITLEMENT OF INDEMNIFICATION IF NO CHANGE OF
CONTROL........................................................................... 15
SECTION 8.7 PROCEDURES OF INDEPENDENT COUNSEL................................................. 16
SECTION 8.8 EXPENSES OF INDEPENDENT COUNSEL................................................... 16
SECTION 8.9 TRIAL DE NOVO..................................................................... 17
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SECTION 8.10 NON-EXCLUSIVITY.................................................................. 17
SECTION 8.11 INSURANCE AND SUBROGATION........................................................ 18
SECTION 8.12 SEVERABILITY..................................................................... 18
SECTION 8.13 CERTAIN PERSONS NOT ENTITLED TO INDEMNIFICATION.................................. 18
SECTION 8.14 DEFINITIONS...................................................................... 18
SECTION 8.15 NOTICES.......................................................................... 20
SECTION 8.16 CONTRACTUAL RIGHTS............................................................... 20
ARTICLE IX............................................................................................... 20
AMENDMENTS............................................................................................... 20
SECTION 9.1 VOTE REQUIREMENTS................................................................. 20
SECTION 9.2 STOCKHOLDER PROPOSALS............................................................. 20
ARTICLE X................................................................................................ 21
GENERAL PROVISIONS....................................................................................... 21
SECTION 10.1 DIVIDENDS......................................................................... 21
SECTION 10.2 DISBURSEMENTS..................................................................... 21
SECTION 10.3 FISCAL YEAR....................................................................... 22
SECTION 10.4 CORPORATE SEAL.................................................................... 22
SECTION 10.5 DEFINITION OF BENEFICIAL OWNER.................................................... 22
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ARTICLE I
OFFICES
Section 1.1 Registered Office. The registered office of HouseHold
Direct.com, Inc. (the "Corporation") in the State of Delaware, is 201 N. Dupont
Parkway, New Castle, New Castle County, Delaware 19720. The registered agent at
such address is Delaware Intercorp, Inc.
Section 1.2 Other Offices. The Corporation may also have offices at
such other places both within and without the State of Delaware as the Board of
Directors may from time to time determine.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1 Place of Meetings. Meetings of the stockholders for the
election of directors or for any other purpose shall be held at such time and
place, either within or without the State of Delaware, as shall be designated
from time to time by the Board of Directors and stated in the notice of the
meeting or in a duly executed waiver of notice thereof.
Section 2.2 Annual Meeting. The annual meeting of stockholders shall be
held on such date and at such time as shall be designated from time to time by
the Board of Directors and stated in the notice of meeting at which meeting the
stockholders shall elect a Board of Directors, and transact such other business
as may properly be brought before the meeting. Written notice of the annual
meeting stating the place, date and hour of the meeting shall be given to each
stockholder entitled to vote of such meeting not less than ten nor more than 60
days before the date of the meeting.
Section 2.3 Special Meetings. Unless otherwise prescribed by law or by
the Certificate of Incorporation of the Corporation, as amended from time to
time to time (the "Certificate of Incorporation"), special meetings of
stockholders, for any purpose or purposes, may be called by the Chairman of the
Board, if any, the President or the Secretary oat the instruction of a majority
of the Board of Directors or on the written request of holders of at least 50%
of the total number of shares of capital stock of the Corporation issued and
outstanding and entitled to vote. Such request shall state the specific purpose
of purposes of the proposed meeting. Written notice of the special meeting
stating the place, date and hour of the meeting and the purpose or purposes for
which the meeting is called shall be given to each stockholder entitled to vote
at such meeting not less than ten nor more than 60 days before the date of such
meeting.
Section 2.4 Quorum. Except as otherwise provided by law or by the
Certificate of Incorporation, the holders of a majority of the capital stock
issued and outstanding and entitled to vote, present in person or represented by
proxy, shall constitute a quorum at all meetings of
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stockholders for the transaction of business. If, however, such quorum shall not
be present or represented at any meeting of stockholders, the stockholders
entitled to vote, present in person or represented by proxy, shall have power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall be present or represented. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed. If the adjournment is for more than 30 days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting shall be given to each stockholder entitled to vote at the
meeting.
Section 2.5 Voting. Unless otherwise required by law, the Certificate
of Incorporation or these Bylaws, any question brought before any meeting of
stockholders shall be decided by the vote of the holders of a majority of the
stock represented and entitled to vote. Each stockholder represented at a
meeting of stockholders shall be entitled to cast one vote for each share
standing in his name on the books of the Corporation. Votes may be cast in
person or by proxy but no proxy shall be voted or acted on or after three years
from its date, unless such proxy provides for a longer period. The Board of
Directors, in its discretion, or the officer of the Corporation presiding at a
meeting of stockholders, in his discretion, may require that any votes cast at
such meeting shall be cast by written ballot.
Section 2.6 List of Stockholders Entitled to Vote. The officer of the
Corporation who has charged of the stock ledger of the Corporation shall prepare
and make, at least ten days before every meeting of stockholders, a complete
list of the stockholders entitled to vote at the meeting, showing the address of
each stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any stockholder, for
any purpose germane to the meeting, during ordinary business hours, for a period
of at least ten days prior to the meeting, either at a place within the city
where the meeting is to be held, which place shall be specified in the notice of
the meeting, or if not so specified, at the place where the meeting is to be
held. The list shall also be produced and kept at the time and place of the
meeting during the whole time thereof and may be inspected by any stockholder of
the Corporation who is present.
Section 2.7 Stock Ledger. The stock ledger of the Corporation shall be
the only evidence as to who are the stockholders entitled (i) to examine the
stock ledger, the list required by Section 2.6 of this Article II or the books
of the Corporation and (ii) to vote in person or by proxy at any meeting of
stockholders.
Section 2.8 Record Date. In order that the Corporation may determine
the stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of any
other lawful action, the Board of Directors may fix a record date, which in the
case of a meeting, shall not be less than the minimum nor more than the maximum
number of days prior to the scheduled date
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of such meeting permitted under the laws of the State of Delaware and which, in
the case of any other action, shall be not less than the minimum nor more than
the maximum number of days prior to any such action permitted by the laws of the
state of Delaware. If no such record date is fixed by the Board of Directors,
the record date shall be that prescribed by the laws of the State of Delaware. A
determination of stockholders of record entitled to notice of or to vote at a
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
Section 2.9 Conduct of Meetings by Presiding Person. All determinations
of the presiding person at each meeting of stockholders shall be conclusive
unless a matter is determined otherwise upon motion duly adopted by the
affirmative vote of the holders of at least 80% of the voting power of the
shares of capital stock of the Corporation entitled to vote in the election of
directors held by stockholders present in person or represented by proxy at such
meeting. Accordingly, in any meeting of stockholders or part thereof, the
presiding person shall have the sole power to determine appropriate rules or to
dispense with theretofore prevailing rules. Without limited the foregoing, the
following rules shall apply:
(a) The presiding person may ask or require that anyone not a
bonafide shareholder or duly authorized proxy leave the
meeting.
(b) A resolution or motion shall be considered for vote only if
proposed by a stockholder or duly authorized proxy, and
seconded by an individual, who is a stockholder or a duly
authorized proxy, other than the individual who proposed the
resolution or motion, subject to compliance with any other
requirements concerning such proposed resolution or motion
contained in these Bylaws. The presiding person may propose
any motion for vote. The order of business at all meetings of
stockholders shall be determined by the presiding person.
(c) The presiding person may impose any reasonable limits with
respect to participation in the meeting by stockholders,
including, but not limited to, limits on the amount of time at
the meeting taken up by the remarks or questions of any
stockholder, limits on the numbers of questions per
stockholder, and limits as to the subject matter and timing of
questions and remarks by stockholders.
(d) Before any meeting of stockholders, the Board of Directors may
appoint any person other than nominees for office to act as
inspectors of election at the meeting or its adjournment. If
no inspectors of election are so appointed, the presiding
person may, and on the request of any stockholder or
stockholder's proxy shall, appoint an inspector or inspectors
of election at the meeting of stockholders. If any person
appointed as inspector fails to appear or fails or refuses to
act, the presiding person may, and upon the request of any
stockholder or a duly authorized proxy shall, appoint a person
to fill such vacancy.
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The duties of the inspectors of election shall be as follows:
(i) to determine the number of shares outstanding and the voting
power of each, the shares represented at the meeting, the
existence of a quorum, and the authenticity, validity and
effect of proxies;
(ii) to receive notes or ballots;
(iii) to hear and determine all challenges and questions in any way
arising in connection with the right to vote;
(iv) to count and tabulate all votes;
(v) to report to the Board of Directors the results based on the
information assembled by the inspectors; and
(vi) to do any other acts that may be property conduct the election
or vote with fairness to all stockholders.
Notwithstanding the foregoing, the final certification of the results of any
election or other matter acted upon at a meeting of stockholders shall be made
by the Board of Directors.
Section 2.10 Nomination of Directors. Nominations for the election of
directors may be made by the Board of Directors or by any stockholder (a
"Nominator") entitled to vote in the election of directors. Such nominations,
other than those made by the Board of Directors shall be made in writing
pursuant to timely notice delivered to or mailed and received by the Secretary
of the Corporation as set forth in this Section 2.10. To be timely in connection
with an annual meeting of stockholders, a Nominator's notice, setting forth the
name and address of the person to be nominated, shall be delivered to or mailed
and received at the principal executive offices of the Corporation not less than
90 days nor more than 180 days prior to the date on which the immediately
preceding year's annual meeting of stockholders was held. To be timely in
connection with any election of a director at a special meeting of the
stockholders, a Nominator's notice, setting forth the name of the person to be
nominated, shall be delivered to or mailed and received at the principal
executive office of the Corporation not less than 40 days nor more than 60 days
prior to the date of such meeting; provided, however, that in the event that
less than 50 days' notice or prior public disclosure of the date of the special
meeting of the stockholders is given or made to the stockholders, the
Nominator's notice to be timely must be so received not later than the close of
business on the seventh day following the day on which such notice of date of
the meeting was mailed or such public disclosure was made. At such time, the
Nominator shall also submit written evidence, reasonably satisfactory to the
Secretary of the Corporation, that the Nominator is a stockholder of the
Corporation and shall identify in writing (i) the name and address of the
Nominator, (ii) the number of shares of each class of capital stock of the
Corporation owned beneficially by the Nominator, (iii) the name and address of
each of the
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persons with whom the Nominator is acting in concert and (iv) the number of
shares of capital stock beneficially owned by each such person with whom the
Nominator is acting in concert pursuant to which the nomination or nominations
are to be made. At such time, the Nominator shall also submit in writing (i) the
information with respect to each such proposed nominee that would be required to
be provided in a proxy statement prepared in accordance with Regulation 14A
under the Securities Exchange Act of 1934, as amended, and (ii) a notarized
affidavit executed by each such proposed nominee to the effect that, if elected
as a member of the Board of Directors, he will serve and that he is eligible for
election as a member of the Board of Directors. Within 30 days (or such shorter
time period that may exist prior to the date of the meeting) after the Nominator
has submitted the aforesaid items to the Secretary of the Corporation, the
Secretary of the Corporation shall determine whether the evidence of the
Nominator's status as a stockholder submitted by the Nominator is reasonably
satisfactory and shall notify the Nominator in writing of his determination. The
failure of the Secretary of the Corporation to fund such evidence reasonably
satisfactory, or the failure of the Nominator to submit the requisite
information in the form or within the time indicated, shall make such nomination
ineffective for the election at the meeting at which such person is proposed to
be nominated. The presiding person at each meeting of stockholders shall, if the
facts warrant, determine and declare to the meeting that a nomination was not
made in accordance with the procedures prescribed by these Bylaws, and if he
should so determine, he shall so declare to the meeting and the defective
nomination shall be disregarded.
Section 2.11 Stockholder Proposals Regarding Amendments to Certificate
of Incorporation. No proposal by a stockholder to amend or supplement the
Certificate of Incorporation shall be voted upon at a meeting of stockholders
unless, at least not less than 90 nor more than 180 days before such meeting of
stockholders, such stockholder shall have delivered in writing to the Secretary
of the Corporation (i) notice of such proposal and the text of such amendment or
supplement, (ii) evidence, reasonably satisfactory to the Secretary of the
Corporation, of such stockholder's status as such and of the number of shares of
each class of the capital stock of the Corporation beneficially owned by such
stockholder, (iii) a list of the names of other beneficial owners of shares of
the capital stock of the Corporation, if any, with whom such stockholder is
acting in concert, and of the number of shares of each class of the capital
stock of the Corporation beneficially owned by each such beneficial owner, and
(iv) an opinion of counsel, which counsel and the form and substance of which
opinion shall be reasonably satisfactory to the Board of Directors of the
Corporation, to the effect that the Certificate of Incorporation, as proposed to
be so amended or supplemented, would not be in conflict with the laws of the
State of Delaware. Within 30 days after such stockholder shall have delivered
the aforesaid items to the Secretary of the Corporation, the Secretary of the
Corporation shall determine whether the items to be ruled upon by them are
reasonably satisfactory and shall notify such stockholder in writing of its
determination. If such stockholder fails to submit a required item in the form
or within the time indicated, or if the Secretary for the Corporation determines
that the items to be ruled upon by it are not reasonably satisfactory, then such
proposal by such stockholder may not be voted upon by the stockholders of the
Corporation at such meeting of stockholders. Nothing in this Section 2.11 shall
be construed to affect the procedures set forth in
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Section 242 of the Delaware General Corporation Law, including, but not limited
to, the requirement that the Board of Directors adopt a stockholder resolution
setting forth the proposed amendment to the Certificate of Incorporation and
declaring its advisability, and arrange for the resolution to be voted on at a
meeting of the stockholders.
Section 2.12 Stockholder Action by Written Consent. Any action which
may be taken by stockholders at an annual or special meeting of stockholders may
be taken by written consent, without a meeting, unless otherwise provided in the
Certificate of Incorporation.
ARTICLE III
DIRECTORS
Section 3.1 Number and Election of Directors. The number of directors
that shall constitute the whole Board of Directors may be increased or decreased
from time to time by resolution adopted by the Board of Directors, provided,
however, no decrease in the number of directors shall have the effect of
shortening the term of any incumbent director. Except as provided in Section 3.2
of this Article III, directors shall be elected by a plurality of the votes cast
at the annual meetings of stockholders and each director so elected shall hold
office until the next annual meeting and until his successor is duly elected and
qualified or until his earlier resignation or removal. Any director may resign
at any time upon notice to the Corporation. A director need not be a
stockholder, a citizen of the United States or a resident of Delaware.
Section 3.2 Vacancies. Vacancies and newly created directorships
resulting from any increase in the authorized number of directors may be filled
by a majority of the directors then in office, though less than a quorum, or by
a sole remaining director and the directors so chosen shall hold office until
the next annual election and until their successors are duly elected and
qualified or until their earlier resignation or removal. If there are no
directors in office, then an election of directors may be held in the manner
provided by statute.
Section 3.3 Duties and powers. The business of the Corporation shall be
managed by or under the direction of the Board of Directors, which may exercise
all such powers of the Corporation and do all such lawful acts and things as are
not by statute or by the Certificate of Incorporation or by these Bylaws
directed or required to be exercised or done by the stockholders.
Section 3.4 Meetings. The Board of Directors may hold meetings, both
regular and special, either within or without the State of Delaware. Regular
meetings of the Board of Directors may be held without notice at such time and
at such place as may from time to time be determined by the Board of Directors.
Special meetings of the Board of Directors may be called by or at the direction
of the Chairman of the Board, if any, the President or a majority of the
directors then in office. Notice thereof stating the place, date and hour of the
meeting shall be given to each director either by facsimile, telephone or
telegram at least 24 hours before the
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meeting. Notice need not be given to any director or to any member of a
committee of directors who submits a written waiver of notice signed by him or
her. Attendance of any such person at a meeting shall constitute a waiver of
notice of such meeting, except when he or she attends a meeting for the express
purpose of objecting, at the beginning of the meeting, to the transaction of any
business because the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any regular or special meeting
of the directors need be specified in any written waiver of notice.
Section 3.5 Quorum. Except as may be otherwise specifically provided by
law, the Certificate of Incorporation or these Bylaws, at all meetings of the
Board of Directors a majority of the entire Board of Directors shall constitute
a quorum for the transaction of business and the act of a majority of the
directors present at any meeting at which there is a quorum shall be the act of
the Board of Directors. If a quorum is not present at a meeting of the Board of
Directors, the directors present may adjourn the meeting from time to time,
without notice other than by an announcement at the meeting, until quorum is
present.
Section 3.6 Action of Board. Unless otherwise provided by the
Certificate of Incorporation or these Bylaws, any action required or permitted
to be taken at any meeting of the Board of Directors may be taken without a
meeting, if all the members of the Board of Directors consent thereto in
writing, in one document or in counterparts, and the writing or writings are
filed with the minutes of proceedings of the Board of Directors.
Section 3.7 Meetings by Means of Conference Telephone. Unless otherwise
provided by the Certificate of Incorporation, members of the Board of Directors
or any committee designated by the Board of Directors may participate in a
meeting of the Board of Directors or such committee by means of a conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and participation in a meeting
pursuant to this Section 3.7 shall constitute presence in person at such
meeting.
Section 3.8 Compensation. The Board of Directors may from time to time
by resolution authorize the payment of fees, the grant of options to acquire
stock in the Corporation or other compensation to the Directors for services as
such to the Corporation including, but not limited to, a fixed sum and expenses
for attendance at each regular or special meeting of the Board of Directors or
any committee thereof; provided that nothing contained herein shall be construed
to preclude any director from serving the Corporation in any other capacity and
receiving compensation therefor.
Section 3.9 Interested Directors. No contract or transaction between
the Corporation and one or more of its directors or officers, or between the
Corporation and any other corporation, partnership, association or other
organization in which one or more of its directors or officers are directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for this reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors or committee
thereof that authorizes that contract or
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transaction, or solely because his, her or their votes are counted for such
purpose if (a) the material facts as to his, her or their relationship or
interest as to the contract or transaction are disclosed or are known the Board
of Directors or committee, and the Board of Directors or committee in good faith
authorizes the contract or transaction by the affirmative note of a majority of
the disinterested directors, even through the disinterested directors be less
than a quorum, (b) the material facts as to his, her or their relationship or
interest as to the contract or transaction are disclosed or are known to the
stockholders entitled to vote thereon and the contract or transaction is
specifically approved in good faith by vote of the stockholders or (c) the
contract or transaction is fair as to the Corporation as of the time it is
authorized, approved or ratified by the Board of Directors, a committee thereof
or the stockholders. Common or interested directors may be counted in
determining the presence of a quorum at a meting of the Board of Directors or a
committee that authorizes the contract or transaction.
Section 3.10 Removal. No director of the Corporation shall be removed
as a director by vote or other action of the stockholders or otherwise except
(a) with cause, as defined below, by the affirmative vote of the holders of at
least a majority of the voting power of all outstanding shares of capital stock
of the Corporation entitled to vote in the election of directors, voting
together as a single class, or (b) without cause by (i) the affirmative vote of
at least 80% of all directors then in office at any regular or special meeting
of the Board of Directors called for that purpose or (ii) the affirmative vote
of the holders of at least 80% of the voting power of all outstanding share of
capital stock of the Corporation entitled to vote in the election of directors,
voting together as a single class.
Except as may otherwise be provided by law, cause for removal of a
director shall be deemed to exist only if: (a) the director whose removal is
proposed has been convicted, or where a director is granted immunity to testify
where another has been convicted, of a felony by a court of competent
jurisdiction and such conviction is no longer subject to direct appeal; (b) such
director has been found by the affirmative vote of at least 80% of all directors
then in office at any regular or special meeting of the Board of Directors
called for that purpose or by a court of competent jurisdiction to have been
negligent or guilty of misconduct in the performance of his duties to the
Corporation in a matter of substantial importance to the Corporation; or (c)
such director has been adjudicated by a court of competent jurisdiction to be
mentally incompetent, which mental incompetency directly affects his ability as
a director of the Corporation.
A proposal by a stockholder to remove a director of the Corporation
shall be made in writing pursuant to timely notice delivered to or mailed and
received by the Secretary of the Corporation as set forth in this Section 3.10.
To be timely in connection with an annual meeting of stockholders, a
stockholder's notice and other aforesaid items shall be delivered to or mailed
and received at the principal executive offices of the Corporation not less than
90 nor more than 180 days prior to the date on which the immediately preceding
year's annual meeting of stockholders was held. To be timely in connection with
the removal of any director at a special meeting of the stockholders, a
stockholder's notice and other aforesaid items shall be delivered to or mailed
and received at the principal executive offices of the Corporation not less than
40 days nor
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more than 60 days prior to the date of such meeting; provide, however, that in
the event that less than 50 days' notice of prior public disclosure of the date
of the special meeting of stockholders is given or made to the stockholders, the
stockholder's notice and other aforesaid items to be timely must be so received
not later than the close of business on the seventh day following the day on
which such notice of date of the meeting was mailed or such public disclosure
was made. At such time, such stockholder shall also submit in writing (i) a
statement of the grounds, if any, on which such director is proposed to be
removed, (ii) evidence, reasonably satisfactory to the Secretary of the
Corporation, of such stockholder's status as such and of the number of shares of
each class of the capital stock of the Corporation beneficially owned by such
stockholder, (iii) a list of names and addresses of other beneficial owners of
shares of the capital stock of the Corporation, if nay, with whom such
stockholder is acting in concert, and of the number of shares of each class of
the capital stock of the Corporation beneficially owned by each such beneficial
owner, and (iv) an opinion of counsel, which counsel and the form and substance
of which opinion shall be reasonably satisfactory to the Board of Directors of
the Corporation (excluding the director proposed to be removed), to the effect
that, if adopted at a duly called special or annual meeting of the stockholders
of the Corporation by the required vote as set forth in the first paragraph of
this Section 3.10, such removal would not be in conflict with the laws of the
State of Delaware, the Certificate of Incorporation or these Bylaws. Within 30
days (or such shorter period that may exist prior to the date of the meeting)
after such stockholder shall have delivered the aforesaid items to the Secretary
for the Corporation, the Secretary and the Board of Directors of the Corporation
shall respectively determine whether the items to be ruled upon by them are
reasonably satisfactory and shall notify such stockholder in writing of their
respective determinations. If such stockholder fails to submit a required item
in the form or within the time indicated, or if the Secretary or the Board of
Directors of the Corporation determines that the items to be ruled upon by them
are not reasonably satisfactory, then such proposal by such stockholder may not
be voted upon by the stockholders of the Corporation at such meeting of the
stockholders. The presiding person at each meeting of stockholders shall, if the
facts warrant, determine and declare to the meeting that a proposal to remove a
director of the Corporation was not made in accordance with the procedures
prescribed by these Bylaws, and if he should so determine, he shall so declare
to the meeting and the defective proposal shall be disregarded.
ARTICLE IV
COMMITTEES
Section 4.1 Committees. The Board of Directors may, by resolution
passed by a majority of the whole Board, designate one or more committees, each
committee to consist of one or more of the directors of the Corporation. The
Board may designate one or more directors as alternate embers of any committee,
who may replace any absent or disqualified member at any meeting of the
committee. In the absence or disqualification of a member of a committee, and in
the absence of a designation by the Board of Directors of an alternate member to
replace the absent or disqualified member, the member or members present at any
meeting and not disqualified
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from voting, whether or not he or they constitute a quorum, may unanimously
appoint another member of the Board of Directors establishing such committee,
shall have and may exercise all the powers and authority of the Board of
Directors in the management of the business and affairs of the Corporation;
provide, however, no committee shall have the power or authority to amend the
Certificate of Incorporation, adopt an agreement of merger or consolidation,
recommend to the stockholders the sale, lease or exchange of all or
substantially all of the Corporation's property and assets, recommend to the
stockholders a dissolution of the Corporation or a revocation of a dissolution,
or amend these Bylaws; and, unless the resolution expressly so provides, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. Each committee shall keep regular minutes and
report to the Board of Directors when required to do so.
Section 4.2 Committee Rules. Unless the Board of Directors otherwise
provides, each committee designated by the Board may make, alter and repeal
rules for the conduct of its business. In the absence of such rules, each
committee shall conduct its business in the same manner as the Board of
Directors conducts its business pursuant to Article III of these Bylaws.
ARTICLE V
OFFICERS
Section 5.1 General. The Board of Directors, in its discretion, may
elect a Chairman of the Board (who must be a director), President, Secretary,
Treasurer and Controller and one or more Vice Presidents, Assistant Secretaries,
Assistant Treasurers and other officers. Any number of offices may be held by
the same person, unless otherwise prohibited by law, the Certificate of
Incorporation or these Bylaws. The officers of the Corporation need not be
stockholders of the Corporation or, except in the case of the Chairman of the
Board of Directors, directors of the Corporation.
Section 5.2 Election. The Board of Directors at its first meeting held
after each annual meeting of stockholders hall elect the officer's of the
Corporation, who shall hold their offices for such terms and shall exercise such
powers and perform such duties as shall be determined from time to time by the
Board of Directors; and all officers of the Corporation shall hold office until
their successors are chosen and qualified or until their earlier resignation or
removal. Any officer elected by the Board of Directors may be removed at any
time by the affirmative vote of a majority of the Board of Directors. Any
vacancy occurring in any office of the Corporation shall be filled by the Board
of Directors. The salaries of all officers of the Corporation shall be fixed by
the Board of Directors and may be altered from time to time except as otherwise
provided by contract.
Section 5.3 Chairman of the Board of Directors. The Chairman of the
Board of Directors shall be the chief executive officer of the Corporation, and,
under the direction and subject to the control of the Board of Directors, the
Chairman of the Board of Directors in general shall
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supervise and control all of the business and affairs of the Corporation and
shall be its chief policy making officer. The Chairman of the Board of Directors
shall preside at all meetings of the stockholders and of the Board of Directors
and shall perform such other duties as the Board of Directors may assign him
from time to time. The Chairman of the Board of Directors shall possess the same
power as the President to sign all contracts, certificates and other instruments
of the Corporation.
Section 5.4 President. The President shall be the chief operating
officer of the Corporation and shall report to the Chairman of the Board of
Directors. The President shall, subject to the powers of the Board of Directors
and the Chairman of the Board of Directors, have general charge of the business,
affairs and property of the Corporation, and control over Directors are carried
into effect. The President may execute and deliver certificates for shares of
the Corporation, any deeds, mortgages, bond, contracts or other instruments that
the Board of Directors has authorized to be executed and delivered, except in
cases where the execution and delivery thereof shall be expressly delegated to
another officer of shall be otherwise required by law to be executed and
delivered by another person. The President shall also perform such other duties
and may exercise such other powers as from time to time may be assigned to him
or her by these Bylaws or by the Board of Directors.
Section 5.5 Vice Presidents. Each Vice President shall perform such
duties and have such other powers as the Board of Directors from time to time
may prescribe. Certain Vice Presidents may form time to time be designated by
the Board of Directors or the Chairman of the Board of Directors as Executive
Vice Presidents or Senior Vice Presidents, which positions shall have such
varying degrees of authority as the Board of Directors shall prescribe.
Section 5.6 Absence of Officers. In the absence or disability of the
Chairman of the Board of Directors, or if there be none, the President shall
preside at all meetings of the stockholders and (if the President is a director)
the Board of Directors. In the absence or disability of both the Chairman of the
Board of Directors and the President, or at the request of the Chairman of the
Board of Directors, the Vice President or the Vice Presidents, if there be more
than one, shall perform the duties of the Chairman of the Board of Directors,
and when so acting, shall have all the powers of and be subject to all the
restrictions upon the Chairman of the Board of Directors. If there be no
Chairman of the Board of Directors, President or Vice President, of the Board of
Directors shall designate the officer of the Corporation who shall perform the
duties of the Chairman of the Board of Directors, and when so acting, shall have
all the powers of and be subject to all the restrictions upon the Chairman of
the Board of Directors.
Section 5.7 Secretary. The Secretary shall attend all meetings of the
Board of Directors and all meetings of stockholders and record all the
proceedings thereat in a book or books to be kept for that purpose; the
Secretary shall also perform like duties for the standing committees when
required. The Secretary shall give, or cause to be given, notice of all meetings
of the stockholders and special meetings for the Board of Directors, and shall
perform such other duties as may be prescribed by the Board of Directors or
Chairman of the Board of Directors, under
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whose supervision he or she shall be. If the Secretary shall be unable or shall
refuse to cause to be given notice of all meetings of the stockholders and
special meetings of the Board of Directors, and if there be no Assistant
Secretary, then either the Board of Directors or the Chairman of the Board of
Directors may choose another officer to cause such notice to be given. The
Secretary shall have custody of the seal of the Corporation and the Secretary of
an Assistant Secretary, if there be one, shall have authority to affix the same
to any instrument requiring it and when so affixed, it may be attested by the
signature. The Secretary shall see that all books, reports, statements,
certificates and other documents and records required by law to be kept or filed
are properly kept or filed, as the case may be.
Section 5.8 Treasurer. The Treasurer shall be the chief financial
officer and shall have the custody of the corporate funds and securities and
shall keep full and accurate accounts of receipts and disbursements in books
belonging to the Corporation and shall deposit all moneys and other valuable
effects in the name and to the credit of the Corporation in such depositories as
may be designated by the Board of Directors. The Treasurer shall disburse the
funds of the Corporation as may be ordered by the Board of Directors, taking
proper vouchers for such disbursements, and shall render to the Chairman of the
Board of Directors and the Board of Directors, at its regular meeting, or when
the Board of Directors so requires, an account of all his or her transactions as
Treasurer and of the financial condition of the Corporation. If required by the
Board of Directors, the Treasurer shall give the Corporation a bond in such sum
and with such surety or sureties as shall be satisfactory to the Board of
Directors for the faithful performance of the duties of his or her office and
for the restoration to the Corporation, in case of his or her death,
resignation, retirement or removal from office, of all books, papers, vouchers,
money and other property of whatever kind in his or her possession or under his
or her control belonging to the Corporation.
Section 5.9 Controller. The Controller, if there be one, shall have
charge of the Corporation's books of account, records and auditing, and shall be
subject in all matters to the control of the Chairman of the Board of Directors
and the Board of Directors. The Controller shall report to the Treasurer.
Section 5.10 Assistant Secretaries. Except as may be otherwise provided
in these Bylaws, Assistant Secretaries, if there by any, shall perform such
duties and have such powers as from time to time may be assigned to them by the
Board of Directors, the Chairman of the Board of Directors, the President, any
Vice President, if there be one, or the Secretary, and in the absence of the
Secretary or in the Event of his or her disability or refusal to act, shall
perform the duties of the Secretary, and when so acting, shall have all the
powers of and be subject to all the restrictions upon the Secretary.
Section 5.11 Assistant Treasurers. Assistant Treasurers, if there by
any, shall perform such duties and have such powers as from time to time may be
assigned to them by the Board of Directors, the Chairman of the Board of
Directors, the President, any Vice President, if there be one, or the Treasurer,
and in the absence of the Treasurer or in the event of his or her disability or
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refusal to act, shall perform the duties of the Treasurer, and when so acting,
shall have all the powers of and be subject to all the restrictions upon the
Treasurer. If required by the Board of Directors, an Assistant Treasurer shall
give the Corporation a bond in such sum and with such surety or sureties as
shall be satisfactory to the Board of Directors for the faithful performance of
the duties of his or her office and for the restoration to the Corporation, in
case of his or her death, resignation, retirement or removal from office, of all
books, papers, vouchers, money and other property of whatever kind in his or her
possession or under his or her control belonging to the Corporation.
Section 5.12 Other Officers. Such other officers as the Board of
Directors may appoint shall perform such duties and have such powers as from
time to time may be assigned to them by the Board of Directors. The Board of
Directors may delegate to any other officer of the Corporation the power to
choose such other officers and to prescribe their respective duties and powers.
Section 6.1 Certificates Evidencing Shares. Every holder of stock in
the Corporation shall be entitled to have a certificate signed in the name of
the Corporation (a) by the Chairman or Vice Chairman of the Board of Directors
or the President or a Vice President, and (b) by the Treasurer or an Assistant
Treasurer, or the Secretary or an Assistant Secretary of the Corporation,
certifying the number of shares owned by such holder.
Section 6.2 Transfer Agent. The Corporation may appoint a transfer
agent to act on behalf of the Corporation in keeping certain records on each
registered stockholder and to make legal transfers of the Corporation's shares.
Section 6.3 Signatures. Where a certificate is countersigned by (a) a
transfer agent other than the Corporation or its designated employees or (b) a
registrar other than the Corporation or its designated employees, any other
signature on the certificate may be a facsimile. In case any officer, transfer
agent or registrar who has signed or whose facsimile signature has been placed
upon a certificate shall have ceased to be such officer, transfer agent or
registrar before such certificate is issued, it may be issued by the Corporation
with the same effect as if he or she were such officer, transfer agent or
registrar at the date of issue.
Section 6.4 Lost Certificates. The Board of Directors may direct a new
certificate to be issued in place of any certificate theretofore issued by the
Corporation alleged to have been lost, stolen or destroyed, upon the making of
an affidavit of that fact by the person claiming the certificate of stock to be
lost, stolen or destroyed. When authorizing such issue of a new certificate, the
Board of Directors may, in its discretion and as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or destroyed
certificate, or his or her legal representative, to advertise the same in such
manner as the Board of Directors shall require and/or to give the Corporation a
bond or other indemnity deemed satisfactory by the Board of Directors in such
sum as it may direct as indemnity against any claim that may be made against the
Corporation with respect to the certificate alleged to have been lost, stolen or
destroyed.
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Section 6.5 Transfers. Stock of the Corporation shall be transferable
in the manner prescribed by law and in these Bylaws. Transfers of stock shall be
made on the book of the Corporation only by the person named in the certificate
or by his or her attorney lawfully constituted in writing and upon the surrender
of the certificate therefor, which shall be canceled before a new certificate
shall be issued.
ARTICLE VII
NOTICES
Section 7.1 Notices. Whenever written notice is required by law, the
Certificate of Incorporation or these Bylaws to be given to any director, member
of a committee or stockholder, such notice may be given by mail, addressed to
such director, member of a committee or stockholder, at his address as it
appears on the records of the Corporation, with postage thereon prepaid, and
such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Written notice may also be given personally
or by telegram, telecopy, telex or cable and such notice shall be deemed given
at the time when the same is sent.
Section 7.2 Waivers of Notice. Whenever any notice is required by law,
the Certificate of Incorporation or these Bylaws to be given to any director,
member of a committee or stockholder, a written waiver, signed by the person or
persons entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to notice.
ARTICLE VIII
INDEMNIFICATION
Section 8.1 General. The Corporation shall indemnify, and advance
Expenses (as this and all other capitalized words used in this Article VIII and
not previously defined in these Bylaws are defined in Section 8.14 of this
Article VIII) to, each Indemnitee to the fullest extent permitted by applicable
law in effect on the date of the effectiveness of these Bylaws, and to such
greater extent as applicable law may thereafter permit. The rights of an
Indemnitee provided under the preceding sentence shall include, but not be
limited to, the right to be indemnified to the fullest extent permitted by
Section 145(a) of the DGCL in Proceedings by or in the right of the Corporation
and to the fullest extent permitted by Section 145 (a) of the DGCL in all other
Proceedings. The provisions set forth below in this Article VIII are provided in
furtherance, and not by way of limitation, of the obligations expressed in this
Section. 8.1.
Section 8.2 Expenses Related to Proceedings. If an Indemnitee, by
reason of his or her Corporation Status, is a witness in or a party to and is
successful, on the merits or otherwise, in any Proceeding, he or she shall be
indemnified against all Expenses actually and reasonably incurred by him or her
or on his or her behalf in connection therewith. If an Indemnitee is not wholly
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successful in such Proceeding but is successful, on the merits or otherwise, as
to any Matter in such Proceeding, the Corporation shall indemnify such
Indemnitee against all Expenses actually and reasonably incurred by him or her
or on his or her behalf relating to such Matter. The termination of any Matter
in such a Proceeding by dismissal, with or without prejudice, shall be deemed to
be a successful result as to such Matter.
Section 8.3 Advancement of Expenses. And Indemnitee shall be advanced
Expenses within ten days after requesting them to the fullest extent permitted
by ss. 145(e) of the DGCL.
Section 8.4 Request for Indemnification. To obtain indemnification, and
Indemnitee shall submit to the Corporation a written request with such
information as is reasonably available to such Indemnitee. The Secretary of the
Corporation shall promptly advise the Board of Directors of such request.
Section 8.5 Determining Entitlement to Indemnification If No Change of
Control. If a Change of Control has not occurred prior to or at the time the
request for Indemnification is sent, an Indemnitee's entitlement to
indemnification shall be determined in accordance with ss. 145(d) of the DGCL.
If entitlement to indemnification is set to be determined by Independent
Counsel, the Corporation shall furnish notice to the Indemnitee within ten days
after receipt of the request for indemnification, specifying the identity and
address of Independent Counsel. The Corporation a written objection to such
selection. Such objection may be asserted only on the ground that the
Independent Counsel so selected does not meet the requirements of Independent
Counsel and the objection shall set forth with particularity the factual basis
of such assertion. If there is an objection to the selection of Independent
Counsel, either the Corporation or the Indemnitee may petition the Court of
Chancery of the State of Delaware or any other court of competent jurisdiction
for a determination that the objection is without a reasonable basis and/or for
the appointment of Independent Counsel selected by the court.
Section 8.6 Determining Entitlement to Indemnification If Change of
Control. If a Change of Control has occurred prior to or at the time the request
for indemnification is sent, an Indemnitee's entitlement to indemnification
shall be determined in a written opinion by Independent Counsel selected by such
Indemnitee. The Indemnitee shall give the Corporation written notice advising of
the identity and address of the Independent Counsel so selected. The Corporation
may, within seven days after receipt of such written notice of selection,
deliver to the indemnitee a written objection to such selection. The Indemnitee
may, within five days after the receipt of such objection from the Corporation,
submit the name of another Independent Counsel and the Corporation may, within
seven days after receipt of such written notice of selection, deliver to the
Indemnitee a written objection to such selection. Any objection is subject to
the limitations in Section 8.5 of this Article VIII. The Indemnitee may petition
the Court of Chancery of the State of Delaware or any other court of competent
jurisdiction for a determination that the Corporation's objection to the first
and/or second selection of Independent
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Counsel is without a reasonable basis and/or second selection of Independent
Counsel is without a reasonable basis and/or for the appointment as Independent
Counsel of a person selected by the court.
Section 8.7 Procedures of Independent Counsel. If a Change of Control
has occurred prior to or at the time the request for indemnification is sent by
an Indemnitee, the Indemnitee shall be presumed (except as otherwise expressly
provided in this Article VIII) to be entitled to indemnification upon submission
of a request for indemnification in accordance with Section 8.4 of this Article
VIII, and thereafter the Corporation shall have the burden of proof to overcome
the presumption in reaching a determination contrary to the presumption. The
presumption shall be used by Independent Counsel as a basis for determination of
entitlement to indemnification unless the Corporation provides information
sufficient to overcome such presumption by clear and convincing evidence or the
investigation, review and analysis of Independent Counsel convinces him or her
by clear and convincing evidence that the presumption should not apply.
Except in the event that the determination of entitlement to
indemnification is to be made by Independent counsel, if the person or person
empowered under Section 8.5 or 8.6 of this Article VIII to determine entitlement
to indemnifications shall not have made and furnished to the Indemnitee in
writing a determination within 60 days after receipt by the Corporation of the
request therefor, the requisite determination of entitlement to indemnification
shall be deemed to have been made and the Indemnitee shall be entitled to such
indemnification unless the Indemnitee knowingly misrepresented a material fact
in connection with the request for indemnification. The termination of any
Proceeding or of any Matter therein by Judgment, order, settlement or
conviction, or upon a plea of nolo contendere or its equivalent, shall not
(except as otherwise expressly provided in this Article VIII) of itself
adversely affect the right of the Indemnitee to indemnification or create a
presumption that (a) the Indemnitee did not act in good faith and in a manner
that he or she reasonably believed, in the case of conduct in his or her
official capacity as a director of the Corporation, to be in the best interests
of the Corporation or in all other cases that at least his or her conduct was
not opposed to the Corporation's best interests, or (b) with respect to any
criminal Proceeding, that the Indemnitee had reasonable cause to believe that
his or her conduct was unlawful.
Section 8.8 Expenses of Independent Counsel. The Corporation shall pay
any and all reasonable fees and expenses of Independent Counsel incurred acting
pursuant to this Article VIII and in any proceeding to which it is a party or
witness in respect of its investigation and written report and shall pay all
reasonable fees and expenses incident to the procedures in which such
Independent Counsel was selected or appointed. No Independent Counsel may serve
if a timely objection has been made to his or her selection until a court has
determined that such objection is without a reasonable basis.
Section 8.9 Trial De Novo. In the event that (a) a determination is
made pursuant to Section 8.5 or 8.6 of this Article VIII that an Indemnitee is
not entitled to indemnification under this Article VIII, (b) advancement of
Expenses is not timely made pursuant to Section 8.3 of this
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Article VIII, (c) Independent Counsel has not made and delivered a written
opinion determining the request for Indemnification (i) within 90 days after
being appointed by a court, (ii) within 90 days after objections to his or her
selection have been overruled by a court or (iii) within 90 days after the time
for the Corporation or the Indemnitee to object to his or her selection or (d)
payment of indemnification is not made within five days after a determination of
entitlement to indemnification has been made or deemed to have been made
pursuant to Section 8.5, 8.6 or 8.7 of this Article VIII, the Indemnitee shall
be entitled to an adjudication in any court of competent jurisdiction of his or
her entitlement to such indemnification or advancement of Expenses. In the event
that a determination shall have been made that the Indemnitee is not entitled to
indemnification, any judicial proceeding or arbitration commenced pursuant to
this Section 8.9 shall be conducted in all respects as a de novo trial on the
merits, and the Indemnitee shall not be prejudiced by reason of that adverse
determination. If a Change of Control shall have occurred, in any judicial
proceeding commenced pursuant to this Section 8.9, the Corporation shall have
the burden of providing that the Indemnitee is not entitled to indemnification
or advancement of Expenses, as the case may be. If a determination shall have
been made or deemed to have been made that the Indemnitee is entitled to
indemnification, the Corporation shall be bound by such determination in any
judicial proceeding commenced pursuant to this Section 8.9, or otherwise, unless
the Indemnitee knowingly misrepresented a material fact in connection with the
request for indemnification.
The Corporation shall be precluded from asserting in any judicial
proceeding commenced pursuant to this Section 8.9 that the procedures and
presumptions of this Article VIII are not valid, binding and enforceable and
shall stipulate in any such court that the Corporation is bound by all
provisions of this Article VIII. In the event that the Indemnitee, pursuant to
this Section 8.9, seeks a judicial adjudication to enforce his or her rights
under, or to recover damages for breach of, this Article VIII, the Indemnitee
shall be entitled to recover from the Corporation, and shall be indemnified by
the Corporation against, any and all Expenses actually and reasonably incurred
by him or her in such judicial adjudication, but only if he or she prevails
therein. If it shall be determine din such judicial adjudication that the
Indemnitee is entitled to receive part but not all of the indemnification of
advancement of Expenses sought, the Expenses incurred by the Indemnitee in
connection with such judicial adjudication or arbitration shall be appropriately
prorated.
Section 8.10 Non-Exclusivity. This rights of indemnification and to
receive advancement of Expenses as provided by this Article VIII shall not be
deemed exclusive of any other rights to which an Indemnitee may at any time be
entitled under applicable law, the Certificate of Incorporation, these Bylaws,
any agreement, a vote of stockholders, a resolution of the Board of Directors or
otherwise. No amendment, alteration or repeal of this Article VIII or any
provision hereof shall be effective as to any Indemnitee for acts, events and
circumstances that occurred, in whole or in part, before such amendment,
alteration or repeal. The provisions of this Article VIII shall continue as to
an Indemnitee whose Corporate Status has ceased and shall inure to the benefit
of his or her heirs, executors and administrators.
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Section 8.11 Insurance and Subrogation. To the extent the Corporation
maintains an insurance policy of policies providing liability insurance for
directors or officers of the Corporation or of any other corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
which such person serves a the request of the Corporation, an Indemnitee shall
be covered by such policy or policies in accordance with its or their terms to
the maximum extent of coverage available for any such director or officer under
such policy or policies.
In the event of any payment hereunder, the Corporation shall be
subrogated to the extent of such payment to all the rights of recover of the
Indemnitee, who shall execute all papers required and take all action necessary
to secure such rights, including execution of such documents as are necessary to
enable the Corporation to bring suit to enforce such rights.
The Corporation shall not be liable under this Article VIII to make any
payment of amounts otherwise indemnifiable hereunder if, and to the extent that,
an Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise.
Section 8.12 Severability. If any provision or provisions of this
Article VIII shall be held to be invalid, illegal or unenforceable for any
reason whatsoever, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby; and, to the
fullest extent possible, the provisions of this Article VIII shall be construed
so as to give effect to the intent manifested by the provision held invalid,
illegal or unenforceable.
Section 8.13 Certain Persons Not Entitled to Indemnification.
Notwithstanding any other provision of this Article VIII, no person shall be
entitled to indemnification or advancement of Expenses under this Article VIII
with respect to any Proceeding, or any Matter therein, brought or made by such
person against the Corporation.
Section 8.14 Definitions. For Purposes of this Article VIII:
"Change of Control" means a change in control of the Corporation after
the date of adoption of these Bylaws in any one of the following circumstances:
(a) there shall have occurred an event required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item
on any similar schedule of form) promulgated under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), whether or not the Corporation is then
subject to such reporting requirement; (b) any "person" (as such term is used in
Section 13(d) and 14(d) of the Exchange Act) shall have become the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing 20% or more of the
combined voting power of the Corporation's then outstanding voting securities
without prior approval of at least two-thirds of the members of the Board of
Directors in office immediately prior to such person's attaining such percentage
interest; (c) the Corporation is a party to a merger, consolidation, sale of
assets or other reorganization, or a proxy contest, as a consequence of which
members of the Board of Directors
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in office immediately prior to such transaction or event constitute less than a
majority of the Board of Directors thereafter or (d) during any period of two
consecutive years, individuals who at the beginning of such period constituted
the Board of Directors (including for this purpose any new director whose
election or nomination for election by the Corporation's stockholders was
approved by a vote of at least two-thirds of the directors then still in office
who were directors at the beginning of such period) cease for any reason to
constitute at least a majority of the Board of Directors.
"Corporate Status" describes the status of a person who is or was a
director, officer, or employee or agent of the Corporation or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise which such person is or was serving at the request of the
Corporation.
"DGCL" means the Delaware General Corporation Law, as currently in
effect or as amended from time to time.
"Expenses" shall include all reasonable attorneys' fees, retainers,
court costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute of defend, investigation or being or preparing to be a witness in a
Proceeding.
"Indemnitee" includes any person who is, or is threatened to be made, a
witness in or a party to any Proceeding as described in Section 8.1 or 8.2 of
this Article by reason of his or her Corporate Status.
"Independent Counsel" means a law firm, or member of a law firm, that
is experience in matters of Corporation law and neither presently is, nor in the
five years previous to his or her selection or appointment has been, retained to
represent: (a) the Corporation or the Indemnitee in any matter material to
either such party, (b) any other party to the Proceeding giving rise to a claim
for indemnification hereunder or (c) the beneficial owner, directly or
indirectly, or securities of the Corporation representing 5% or more of the
combined voting power of the Corporation's then outstanding voting securities.
"Matter" is a claim, a material issue, or a substantial request for
relief.
"Proceeding" includes any action, suit arbitration, alternate dispute
resolution mechanism, investigation, administrative hearing or any other
proceeding, whether civil, criminal, administrative or investigative, except one
initiated by an Indemnitee pursuant to Section 8.9 of this Article VIII to
enforce his or her rights under this Article VIII.
Section 8.15 Notices. Any communication required or permitted to the
Corporation shall be addressed to the Secretary of the Corporation and any such
communication to an Indemnitee
BYLAWS - Page 19
<PAGE> 24
shall be given in writing by deposition the same in the United States Mail, with
postage thereon prepaid, addressed to the person to whom such notice is directed
at the address of such person on the records of the Corporation, and such notice
shall be deemed given at the time when the same shall be so deposited in the
United States mail.
Section 8.16 Contractual Rights. The right to be indemnified or to the
advancement of reimbursement of Expenses (i) is a contract right based upon good
and valuable consideration, pursuant to which an Indemnitee may sue as if these
provisions were set forth in a separate written contract between him or her and
the Corporation, (ii) is and is intended to be retroactive and shall be
available as to events occurring prior to the adoption of these provisions and
(iii) shall continue after any rescission or restrictive modification of such
provisions as to events occurring prior thereto.
ARTICLE IX
AMENDMENTS
Section 9.1 Vote Requirements. The Board of Directors shall have the
power to alter, amend or repeal these Bylaws or adopt new Bylaws by the
affirmative vote of at least 80% of all directors then in office at any regular
or special meeting of the Board of Directors called for that purpose, subject to
repeal or change by the affirmative vote of the holders of at least 80% of the
voting power of all the shares of the Corporation entitled to vote in the
election of directors, voting together as a single class.
Section 9.2 Stockholder Proposals. No proposal by a stockholder made
pursuant to Section 9.1 of this Article IX may be voted upon at a meeting of
stockholders unless such stockholder shall have delivered or mailed in a timely
manner (as set forth in this Section 9.2) and in writing to the Secretary of the
Corporation (i) notice of such proposal and the text of the proposed alteration,
amendment or repeal, (ii) evidence reasonably satisfactory to the Secretary of
the Corporation, of such stockholder's status as such and of the number of
shares of each class f capital stock of the Corporation of which such
stockholder is the beneficial owner, (iii) a list of the names and addresses of
other beneficial owners of shares of the capital stock of the Corporation, if
any with whom such stockholder is acting in concert, and the number of shares of
each class of capital stock of the Corporation beneficially owned by each such
beneficial owner and (iv) an opinion of counsel, which counsel and the form and
substance of which opinion shall be reasonably satisfactory to the Board of
Directors of the Corporation, to the effect that the Bylaws (if any) resulting
from the adoption of such proposal would not be in conflict with the Certificate
of Incorporation or the laws of the State of Delaware. To be timely in
connection with an annual meeting of stockholders, a stockholder's notice and
other aforesaid items shall be delivered to or mailed and received at the
principal executive offices of the Corporation not less than 90 nor more than
180 days prior to the date on which the immediately preceding year's annual
meeting of stockholders was held. To be timely in connection with the voting on
any such proposal at a special meeting of the stockholders, a stockholder's
notice and other aforesaid
BYLAWS - Page 20
<PAGE> 25
items shall be delivered to or mailed and received at the principal executive
offices of the Corporation not less than 40 days nor more than 60 days prior to
the date of such meeting; provided, however, that in the event that less than 50
days' notice or prior public disclosure of the date of the special meeting of
the stockholders is given or made to the stockholders, such stockholder's notice
and other aforesaid items to be timely must be so received not later than the
close of business on the seventh day following the day on which such notice of
date of the meeting was mailed or such public disclosure was made. Within 30
days (or such shorter period that may exist prior to the date of the meeting)
after such stockholder shall have submitted the aforesaid items, the Secretary
and the Board of Directors of the Corporation shall respectively determine
whether the items to be ruled upon by them are reasonably satisfactory and shall
notify such stockholder in writing of their respective determinations. If such
stockholder fails to submit a required item in the form or within the time
indicated, or if the Secretary or the Board of Directors of the Corporation
determines that the items to be ruled upon by them are reasonably satisfactory,
then such proposal by such stockholder may not be voted upon by the stockholders
of the Corporation at such meting of stockholders. The presiding person at each
meeting of stockholders shall, if the facts warrant, determine and declare to
the meeting that a proposal made pursuant to Section 9.1 of this Article IX was
not made in accordance with the procedure prescribed by these Bylaws, and if he
should so determine, he shall so declare to the meeting and the defective
proposal shall be disregarded.
ARTICLE X
GENERAL PROVISIONS
Section 10.1 Dividends. Dividends upon the capital stock of the
Corporation, subject to the provisions of the Certificate of Incorporation, if
any, may be declared by the Board of Directors at any regular or special
meeting, and may be paid in cash, in property or in shares of the capital stock.
Before payment of any dividend, there may be set aside out of any funds of the
Corporation available for dividends such sum or sums as the Board of Directors
from time to time, in its absolute discretion, deems proper as a reserve or
reserves to meet contingencies, or for any proper purpose, and the Board of
Directors may modify or abolish any such reserve.
Section 10.2 Disbursements. All checks or demands for money and notes
of the Corporation shall be signed by such officer or officers of such other
person or persons as the Board of Directors may from time to time designate.
Section 10.3 Fiscal Year. The fiscal year of the Corporation shall be
fixed by resolution of the Board of Directors.
Section 10.4 Corporate Seal. The corporate seal shall have inscribed
thereon the name of the Corporation, the year of its organization and the words
"Corporate Seal Delaware." The seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced.
BYLAWS - Page 21
<PAGE> 26
Section 10.5 Definition of Beneficial Owner. "Beneficial owner" as used
in these Bylaws means one of the following:
1. a person who individually or with any of his affiliates or
associates beneficially owns (within the meaning or Rule
13d-3 under the Securities Exchange Act of 1934, as amended)
any capital stock of the Company, directly or indirectly.
2. a person who individually or with any of his affiliates or
associates has either of the following rights:
a. to acquire capital stock of the Corporation, whether
such right is exercisable immediately or only after
the passage of time, pursuant to any agreement,
arrangement or understanding or upon the exercise of
conversion rights, exchange rights, warrants or
options, or otherwise;
b. to vote capital stock of the Corporation pursuant to
any agreement, arrangement or understanding; or
3. a person who has any agreement, arrangement or understanding
for the purpose of acquiring, holding, voting or disposing
capital stock of the Company with any other person who
beneficially owns or whose affiliates beneficially own (within
the meaning of Rule 13d-3 under the Securities Exchange Act of
1934, as amended), directly or indirectly, such shares of
capital stock.
BYLAWS - Page 22
<PAGE> 1
EXHIBIT 10.1
March 9, 2000
HouseHold Direct.com, Inc.
900 Main Street South
Southbury, Ct.
Re: Letter Agreement
Gentlemen:
This letter sets forth the agreement ("Agreement") among HouseHold
Direct.com, Inc. ("HHD"), Jeff Ploen ("Ploen"), Scott Dietler ("Dietler") and
Jim Toot ("Toot", and Ploen, Dietler and Toot collectively the "Sellers") with
respect to the purchase by HHD from the Sellers of 60 shares of the Common
Stock, $.001 par value, of Cross Check Corp., a Colorado corporation (the
"Stock" and the "Company", respectively) and sets forth the entire agreement
among the parties hereto with respect to the subject matter herein contained.
Reference is hereby made to a certain Agreement and Plan of Merger
(the "Merger Agreement") between HHD and the Company of even date herewith,
the definitions of which are hereby incorporated herein by reference with the
same full force and effect as if set forth herein in full.
In consideration of the sum of One ($1.00) and other good and
valuable consideration, each to the other in hand paid, the receipt and
sufficiency of which is hereby mutually acknowledged, the parties hereto do
hereby agree as follows:
1. Subject to the terms and conditions of this Agreement, at the Closing,
the Sellers shall sell to HHD and HHD shall purchase from the Sellers
the Stock, free and clear of all liens, claims and encumbrances and
rights and options of others.
2. In consideration for the Stock, HHD shall, at the Closing, pay to the
Sellers the aggregate amount of $150,000.00 (the "Purchase Price")
computed at the rate of $2,500.00 per share; which Purchase Price
shall be allocated among the Sellers as their respective interests may
appear.
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<PAGE> 2
3. At the Closing:
(a) The Sellers shall deliver to HHD certificates representing the
Stock duly endorsed in blank or accompanied by duly executed
stock assignment powers; and
(b) HHD shall deliver to Michael A. Littman, Esq, ("Payment
Agent") for and on behalf of the Sellers, a bank or certified
check made payable to the order of the Payment Agent in the
amount of Purchase Price (the "Payment"). Upon the successful
filing and recordation of the Certificates of Merger in the
States of Delaware and Colorado the Payment Agent shall: (i) pay
over to each of the Sellers, out of the proceeds of the Payment,
the sum of $125,000.00, and (ii) retain in escrow, pursuant to
the provisions of Paragraph 5 hereof, out of the proceeds of the
Payment, the sum of $25,000.00 (the "Cash Deposit"). If both
Certificates of Merger are not successfully filed and recorded
in the States of Delaware and Colorado within ten days of the
date of the Closing, then and in that event the Payment Agent
shall retain the Payment subject to his receipt of an
agreement executed by all of the parties hereto or an order of a
court of competent jurisdiction final beyond right of review, in
either case, directing the disposition of the Payment.
4. In order to induce HHD to execute, deliver and perform this
Agreement and the Merger Agreement each of the Sellers does
hereby jointly and severally represent, warrant, covenant and
agree (which representations, warranties, covenants and
agreements shall survive the execution, delivery and performance
of this Agreement and the Merger Agreement and the Closing) as
follows:
(a) Each of the representations, warranties, covenants and
agreements of the Company set forth in the Merger Agreement,
including without limitation, those set forth in Article IV
thereof, are true, correct and complete as of the date
hereof and will be true, correct and complete as of the
Closing;
(b) The Sellers own and have good and marketable title in and to
the Stock free and clear of all liens, claims and
encumbrances and rights and options of others;
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<PAGE> 3
(c) At the Closing HHD shall acquire good and marketable title
in and to the Stock free and clear of all liens, claims and
encumbrances and rights and options of others;
(d) Each of the Sellers has the full right, power and
authority to execute, deliver and perform this Agreement;
the execution, delivery and performance of this Agreement by
the Sellers does not violate any law or any agreement to
which any of the Sellers is a party or by any of them or
their respective assets is bound; no consent, authorization
or permission of any person and/or entity, public or
private, is required in connection with the execution,
delivery and/or performance of this Agreement by any of the
Sellers; this Agreement when executed by each of the Sellers
shall be valid and binding upon each of the Sellers and
fully enforceable in accordance with its terms;
(e) Each of the representations, warranties, covenants and
agreements of the Sellers hereincontained are true, correct
and complete as of the date hereof; will be true, correct
and complete as of the Closing; and will be and be deemed to
be remade by each of the Sellers at the Closing.
5 Each of the Sellers does hereby agree to indemnify and hold
harmless HHD from and against any and all claims, demands,
costs, expenses, losses, liabilities and judgements (including
reasonable attorney's fees) of every kind, nature and description
arising out of or relating to any breach or anticipatory breach
(a) by any of the Sellers of this Agreement and/or any of the
representations, warranties, covenants and agreements of the
Sellers herein contained, and (b) by the Company of the Merger
Agreement and/or any of the representations, warranties,
covenants and agreement of the Company therein contained.
6. (a) Upon the successful filing and recordation of the
Certificates of Merger in the States of Delaware and
Colorado) the Sellers shall deliver, or cause to be
delivered, to the Escrow Agent (as defined) the Cash
Deposit; which Cash Deposit the Escrow Agent shall receive,
retain and dispose of solely in accordance with the
provisions of this Agreement. For purposes of this Agreement
the term "Escrow Agent" shall be and mean Michael A.
Littman;
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<PAGE> 4
(b) Subject to the provisions of subparagraph 6(c) hereof, the
Escrow Agent shall, on the 60th day following the Closing,
deliver the Escrow Deposit to the Sellers, as their
respective interests may appear;
(c) If prior to the delivery to the Sellers described in
subparagraph 6(b) hereof, the Escrow Agent shall receive
written notification from counsel to HHD ("Notice") that
the Commission and/or the NASD has failed and/or refused
HHD status as a successor registrant (based on the
registration statement on Form 10-SB previously filed by the
Company) and/or required that in order for the securities of
HHD to be listed (or continued to be listed) for trading
on any recognized securities exchange, including the OTC
Bulletin Board, (i) HHD must file a Form 10-SB, and (ii)
such Form 10-SB must be declared effective by the
Commission, then and in that event:
(1) the Escrow Agent shall promptly send a copy of such
Notice to the Sellers, and
(2) on the 15th day following the transmittal of the Notice
to the Sellers described in subparagraph (1) above,
transmit the Escrow Deposit to HHD; provided however
that if prior such transmittal to HHD the Escrow Agent
shall receive a writing contesting the accuracy of the
Notice, then and in that event the Escrow Agent shall
retain the Escrow Deposit pending the receipt of an
agreement executed by HHD and the Sellers or an order
of a court of competent jurisdiction final beyond right
of review.
7. All notices, elections, reports or other correspondence required
or permitted hereunder shall be in writing and deemed to have
been properly given or delivered when mailed by certified mail,
return receipt requested, postage prepaid, delivered by overnight
express courier, delivery fees prepaid, or transmitted by fax
with receipt confirmed, to the party to whom directed at the
below specified addresses:
If to HHD: 900 South Main Street
Southbury, Ct.
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<PAGE> 5
With a copy to:
Martin J. Gersten, Esq.
90 Birch Hill Road
Newtown, Ct. 06470
If to Ploen:
----------------------------
----------------------------
----------------------------
If to Dietler:
----------------------------
----------------------------
----------------------------
If to Toot:
----------------------------
----------------------------
----------------------------
If to Littman: Michael A. Littman, Esq.
10200 W. 44th Avenue, No. 400
Wheat Ridge, Co. 80033
Any such notice shall be deemed given three days after deposit
with the mail, one day following delivery thereof to an overnight
express courier or upon confirmation of receipt when sent by fax.
The address of a party may be changed in accordance with the
notice provisions of this section.
8. This letter sets forth the entire agreement among the parties
hereto with respect to the subject matter herein contained; shall
be governed and construed in accordance with the laws of the
State of Connecticut; cannot be
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<PAGE> 6
altered, amended, modified, terminated or rescinded except by a
writing executed by all of the parties hereto; and shall inure to
the benefit of and be binding upon the parties hereto and their
respective successors, transferees, heirs, assigns and
beneficiaries.
If the foregoing properly sets forth our agreement kindly execute
a copy of this letter where indicated below and return the same to the
undersigned.
Very truly yours,
/s/ JEFF PLOEN
------------------------------
Jeff Ploen
/s/ SCOTT DIETLER
------------------------------
Scott Dietler
/s/ JIM TOOT
------------------------------
Jim Toot
Accepted and Agreed:
HouseHold Direct.com, Inc.
By /s/ JOHN FOLGER
- -----------------------------
John Folger, President
/s/ MICHAEL A LITTMAN
- -----------------------------
Michael A. Littman, as Payment
Agent and Escrow Agent
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