SHARE EXCHANGE AGREEMENT
by and between
BCS INVESTMENT CORPORATION
and
the shareholders of
AUTOVENU, INC.
Dated as of September 25, 2000
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TABLE OF CONTENTS
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THE SHARE EXCHANGE................................................................................................1
1.1 The Share Exchange..............................................................................1
1.2 Effective Date..................................................................................1
1.3 Exchange of AutoVenu Common Stock...............................................................1
1.4 Exchange of Certificates........................................................................2
1.5 Reporting of Share Exchange.....................................................................2
1.6 Board of Directors of BCS.......................................................................2
THE CLOSING.......................................................................................................2
2.1 Time and Place of Closing.......................................................................2
2.2 Obligations of the AutoVenu Shareholders at or Prior to the Closing.............................2
2.3 Obligations of BCS at or Prior to the Closing...................................................3
REPRESENTATIONS AND WARRANTIES OF THE AUTOVENU SHAREHOLDERS.......................................................3
3.1 Organization and Qualification..................................................................3
3.2 Capitalization..................................................................................4
3.3 Subsidiaries and Affiliates.....................................................................4
3.4 Options or Other Rights.........................................................................4
3.5 Ownership of Shares.............................................................................4
3.6 Validity and Execution of Agreement.............................................................4
3.7 No Conflict.....................................................................................4
3.8 Consents and Approvals..........................................................................5
3.9 Violation of Laws, Permits, etc.................................................................5
3.10 Books and Records...............................................................................5
3.11 AutoVenu Financial Statements...................................................................5
3.12 Undisclosed Liabilities.........................................................................6
3.13 Title to Property; Encumbrances.................................................................6
3.14 Taxes...........................................................................................6
3.15 Litigation......................................................................................7
3.16 Contracts and Other Agreements..................................................................7
3.17 Accounts Receivable and Accounts Payable........................................................7
3.18 Compensation Arrangements; Officers, Directors and Employees....................................8
3.19 ERISA...........................................................................................8
3.20 Operations......................................................................................8
3.21 Intangible Property and Intellectual Property..................................................10
3.22 Employee Relations.............................................................................10
3.23 Insurance......................................................................................10
3.24 Licenses and Permits...........................................................................11
3.25 Year 2000 Compliance...........................................................................11
3.26 Brokers........................................................................................11
3.27 Acquisition of BCS Shares......................................................................11
3.28 Disclosure.....................................................................................12
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REPRESENTATIONS AND WARRANTIES OF BCS............................................................................12
4.1 Organization and Qualification.................................................................12
4.2 Capitalization.................................................................................12
4.3 Subsidiaries and Affiliates....................................................................12
4.4 Options or Other Rights........................................................................12
4.5 Validity and Execution of Agreement............................................................13
4.6 No Conflict....................................................................................13
4.7 Consents and Approvals.........................................................................13
4.8 Violation of Laws, Permits, etc................................................................13
4.9 Books and Records..............................................................................13
4.10 BCS Financial Statements.......................................................................14
4.11 Undisclosed Liabilities........................................................................14
4.12 Title to Property; Encumbrances................................................................14
4.13 Taxes..........................................................................................14
4.14 Litigation.....................................................................................15
4.15 Contracts and Other Agreements.................................................................15
4.16 Compensation Arrangements; Officers, Directors and Employees...................................15
4.17 ERISA..........................................................................................15
4.18 Operations.....................................................................................15
4.19 Year 2000 Compliance...........................................................................17
4.20 Brokers........................................................................................17
4.21 Approval of Share Exchange.....................................................................17
4.22 SEC Reporting Status...........................................................................18
4.23 Investment Company.............................................................................18
4.24 OTC Bulletin Board Status......................................................................18
4.25 Disclosure.....................................................................................18
ACTIONS PRIOR TO CLOSING.........................................................................................18
5.1 Corporate Examinations and Investigations......................................................18
5.2 Conduct of Business............................................................................19
5.3 Preservation of Business.......................................................................19
5.4 Advice of Changes..............................................................................19
5.5 Other Agreements...............................................................................19
CONDITIONS PRECEDENT TO CLOSING..................................................................................20
6.1 Conditions Precedent to the Obligations of BCS to Complete the Closing.........................20
6.2 Conditions Precedent to the Obligations of the AutoVenu Shareholders to Complete the Closing...21
POST-CLOSING COVENANTS...........................................................................................22
7.1 Further Information............................................................................22
7.2 Record Retention...............................................................................23
7.3 Post-Closing Assistance........................................................................23
7.4 SEC Reporting..................................................................................23
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SURVIVAL; INDEMNIFICATION........................................................................................23
8.1 Survival of Agreements, Representations and Warranties.........................................23
8.2 Indemnification by the AutoVenu Shareholders...................................................24
8.3 BCS's Indemnity................................................................................24
8.4 Method of Asserting Claims.....................................................................24
8.5 General Provisions.............................................................................26
TERMINATION OF AGREEMENT.........................................................................................26
9.1 Termination....................................................................................26
9.2 Survival After Termination.....................................................................27
MISCELLANEOUS....................................................................................................27
10.1 Expenses.......................................................................................27
10.2 Further Assurances.............................................................................27
10.3 Notices........................................................................................28
10.4 Arbitration....................................................................................28
10.5 Publicity......................................................................................29
10.6 Entire Agreement...............................................................................29
10.7 Waivers and Amendments.........................................................................29
10.8 Governing Law..................................................................................29
10.9 Binding Effect, No Assignment..................................................................29
10.10 Counterparts...................................................................................29
10.11 Exhibits and Schedules.........................................................................29
10.12 Effect of Disclosure on Schedules..............................................................30
10.13 Headings.......................................................................................30
10.14 Severability of Provisions.....................................................................30
Schedule A - List of AutoVenu, Inc. Shareholders
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THIS SHARE EXCHANGE AGREEMENT is entered into as of September 25, 2000, by and
between BCS INVESTMENT CORPORATION, a Colorado corporation ("BCS"), and the
persons named on Schedule A attached to this Agreement (the "AUTOVENU
SHAREHOLDERS") who are shareholders of AUTOVENU, INC., a Delaware corporation
("AUTOVENU").
RECITALS
It is the intention of the parties hereto that AutoVenu become a wholly-owned
subsidiary of BCS through the exchange of all outstanding shares of AutoVenu
Common Stock for shares of BCS Common Stock and BCS Preferred Stock on the
following terms:
AGREEMENT
NOW, THEREFORE, for and in consideration of the premises and the mutual
agreements hereinafter set forth, in accordance with the provisions of
applicable law, the parties hereby agree as follows:
ARTICLE I
THE SHARE EXCHANGE
1.1 THE SHARE EXCHANGE. Subject to the terms and conditions of this
Agreement, at Closing, the AutoVenu Shareholders shall tender all their
respective shares of AutoVenu Common Stock to BCS in exchange for
shares of BCS common stock, no par value ("BCS COMMON STOCK") and
shares of BCS Series A Preferred Stock, no par value ("BCS PREFERRED
STOCK"). AutoVenu shall become a wholly-owned subsidiary of BCS.
1.2 EFFECTIVE DATE. The Share Exchange will become effective upon the
proper filing of Articles of Share Exchange with the Secretary of State
of the States of Colorado and Delaware.
1.3 EXCHANGE OF AUTOVENU COMMON STOCK. The AutoVenu Common Stock shall be
exchanged in the Share Exchange as follows:
(a) Each certificate that prior to the Effective Date represented
an outstanding share of AutoVenu Common Stock will be
exchanged for 303.7241 shares of BCS Common Stock and 6.393
shares of BCS Preferred Stock. As a result, the AutoVenu
Shareholders will collectively own 85,953,920of the then
outstanding shares of BCS Common Stock. and 1,809,216 shares
of BCS Preferred Stock.
(b) Each share BCS Preferred Stock shall be convertible into 100
shares of BCS Common Stock .
(b) No fraction of a share of BCS Common Stock or BCS Preferred
Stock will be issued upon such exchange of shares of AutoVenu
Common Stock. Instead amounts of shares will be rounded to the
nearest whole number.
Share Exchange Agreement-Page 1
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1.4 EXCHANGE OF CERTIFICATES. At Closing, or as soon as practicable
thereafter, BCS shall deliver to each AutoVenu Shareholder listed on
SCHEDULE A hereto, certificates representing the whole number of shares
of BCS Common Stock and BCS Preferred Stock, and such AutoVenu
Shareholder's certificate(s) of AutoVenu Common Stock shall be
delivered to BCS.
1.5 REPORTING OF SHARE EXCHANGE. For federal, state, and local income tax
return reporting purposes, all parties agree to treat the Share
Exchange as a nontaxable exchange under Section 368 of the Internal
Revenue Code.
1.6 BOARD OF DIRECTORS OF BCS. At closing, or as soon as practicable
thereafter, the board of directors and officers of BCS shall be
replaced with the board of directors and officers of AutoVenu.
ARTICLE II
THE CLOSING
2.1 TIME AND PLACE OF CLOSING. The closing of the Share Exchange (the
"CLOSING") shall, unless otherwise agreed to in writing by the parties,
take place at a mutually acceptable location at 10:00 AM, local time,
on September 25, 2000.
2.2 OBLIGATIONS OF THE AUTOVENU SHAREHOLDERS AT OR PRIOR TO THE CLOSING. At
or within two weeks after Closing, and subject to the satisfaction by
BCS of its obligations hereunder, the AutoVenu Shareholders shall
deliver to BCS the following:
(a) A copy of the Certificate of Incorporation of AutoVenu
certified as of a date within thirty (30) days of the Closing
by the Secretary of State of the State of Delaware and
certified by the corporate secretary of AutoVenu as to the
absence of any amendments between the date of certification by
the Secretary of State and the Closing;
(b) A certificate from the Secretary of State of the State of
Delaware as to the existence and good standing of AutoVenu as
of a date within thirty (30) days of the Closing;
(c) A certificate of the corporate secretary of AutoVenu attaching
thereto true and correct copies of the bylaws of AutoVenu;
(d) The certificate of AutoVenu referred to in SECTION 6.1 hereof;
(e) Such other documents as are required pursuant to this
Agreement or as may reasonably be requested from the AutoVenu
Shareholders by BCS or its counsel as provided for in SECTION
5.1 hereof; and
(f) The certificates evidencing the shares of AutoVenu Common
Stock owned by the AutoVenu Shareholders, duly endorsed for
transfer to BCS.
Share Exchange Agreement-Page 2
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(g) Audited financial statements that are not materially adversely
different from the August 31, 2000 unaudited financial
statements attached as Exhibit B. These financial statements
shall be delivered within 60 days of closing.
2.3 OBLIGATIONS OF BCS AT OR PRIOR TO THE CLOSING. At or within two weeks
after Closing, and subject to the satisfaction by the AutoVenu
Shareholders of their obligations hereunder, BCS shall deliver to the
AutoVenu Shareholders the following:
(a) A copy of the Articles of Incorporation of BCS certified as of
a date within thirty (30) days of the Closing by the Secretary
of State of the State of Colorado and certified by the
corporate secretary of BCS as to the absence of any amendments
between the date of certification by the Secretary of State
and the Closing;
(b) A certificate from the Secretary of State of the State of
Colorado as to the existence and good standing of BCS as of a
date within thirty (30) days of the Closing;
(c) A certificate of the corporate secretary of BCS attaching
thereto true and correct copies of the bylaws of BCS and the
corporate resolutions duly adopted by the board of directors
of BCS authorizing the consummation of the transactions
contemplated hereby;
(d) The certificate of BCS referred to in SECTION 6.2 hereof;
(e) Such other documents as are required pursuant to this
Agreement or as may reasonably be requested from BCS by the
AutoVenu Shareholders or their counsel; and
(f) Certificates evidencing the BCS Common Stock to be issued to
the AutoVenu Shareholders pursuant to ARTICLE I hereof.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
THE AUTOVENU SHAREHOLDERS
Except as expressly set forth and specifically identified by the section number
of this Agreement in the schedule to be delivered to BCS by the AutoVenu
Shareholders within twenty (20) days from the execution of this Agreement (the
"AUTOVENU SHAREHOLDERS DISCLOSURE SCHEDULE"), the AutoVenu Shareholders
represent, warrant, and covenant to BCS as follows:
3.1 ORGANIZATION AND QUALIFICATION. AutoVenu is a corporation duly
organized, validly existing and in good standing under the laws of
Delaware, and has all requisite corporate power and authority to (a)
own, lease and operate its properties and assets as they are now owned,
leased and operated and (b) carry on its business as currently
conducted and as proposed to be conducted. AutoVenu is duly qualified
or licensed to do business in each jurisdiction in which the failure to
be so qualified or licensed could have a material adverse
Share Exchange Agreement-Page 3
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effect in the business, operations, properties, assets, liabilities,
prospects, or condition (financial or otherwise) of AutoVenu
(hereinafter a "MATERIAL EFFECT").
3.2 CAPITALIZATION. The issued and outstanding capital stock of AutoVenu
consists of 283,000 shares of common stock. All of the issued and
outstanding shares of capital stock of AutoVenu are validly issued,
fully paid, and nonassessable, and none of such shares have been issued
in violation of the preemptive rights of any person.
3.3 SUBSIDIARIES AND AFFILIATES. AutoVenu does not own or hold, directly or
indirectly, any equity, debt, or other interest in any entity or
business or any option to acquire any such interest.
3.4 OPTIONS OR OTHER RIGHTS. No options, warrants, calls, commitments or
other rights to acquire, sell or issue shares of capital stock or other
equity interests of AutoVenu, whether upon conversion of other
securities or otherwise, are issued or outstanding, and there is no
agreement or understanding with respect to the voting of such capital
stock or other equity interests.
3.5 OWNERSHIP OF SHARES. The shares of AutoVenu Common Stock are owned of
record and beneficially by the AutoVenu Shareholders as set forth on
Schedule A. The AutoVenu Shareholders possess full authority and legal
right to sell, transfer, and assign the entire legal and beneficial
ownership of the shares of AutoVenu Common Stock, free from all liens,
claims, and encumbrances of any kind; and there are no outstanding
rights or obligations granted by the AutoVenu Shareholders to purchase
or acquire any of the shares of AutoVenu Common Stock or any interest
in any of the shares of AutoVenu Common Stock. Upon transfer of the
shares of AutoVenu Common Stock to BCS hereunder at the Closing, BCS
will receive the entire legal and beneficial interest in the shares of
AutoVenu Common Stock, free and clear of all liens, claims, and
encumbrances and subject to no legal or equitable restrictions of any
kind.
3.6 VALIDITY AND EXECUTION OF AGREEMENT. Each of the AutoVenu Shareholders
has the full legal right, capacity and power required to enter into,
execute and deliver this Agreement and to carry out the transactions
contemplated. This Agreement has been duly executed and delivered by
each of the AutoVenu Shareholders and constitutes the valid and binding
obligation of each of the AutoVenu Shareholders, enforceable in
accordance with its terms, subject to the qualification that
enforcement of the rights and remedies created hereby is subject to (a)
bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting the rights and remedies of creditors and
(b) general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law).
3.7 NO CONFLICT. None of the execution, delivery, or performance of this
Agreement does or will: (a) result in any violation or be in conflict
with or constitute a default under any term or provision of the
Certificate of Incorporation or bylaws of AutoVenu or any term or
provision of any judgment, decree, order, statute, injunction, rule, or
regulation applicable to AutoVenu or any AutoVenu Shareholder, or of
any material note, bond, mortgage, indenture, lease, license,
franchise, agreement, or other instrument or obligation to which
AutoVenu or
Share Exchange Agreement-Page 4
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any AutoVenu Shareholder is bound; (b) result in the creation of any
material option, pledge, security interest, lien, charge, encumbrance,
or restriction, whether imposed by agreement, understanding, law or
otherwise, except those arising under applicable federal or state
securities laws (hereinafter an "ENCUMBRANCE") upon any of the
properties or assets of AutoVenu or any AutoVenu Shareholder pursuant
to any such term or provision; or (c) constitute a default under,
terminate, accelerate, amend or modify, or give any party the right to
terminate, accelerate, amend, modify, abandon, or refuse to perform or
comply with, any material contract, agreement, arrangement, commitment,
or plan to which AutoVenu or any AutoVenu Shareholder is a party, or by
which AutoVenu or any AutoVenu Shareholder or any of their respective
properties or assets may be subject or bound.
3.8 CONSENTS AND APPROVALS. No federal, state, foreign or other regulatory
approvals are required to be obtained, nor any regulatory requirements
complied with, by AutoVenu or any AutoVenu Shareholder in connection
with the Share Exchange.
3.9 VIOLATION OF LAWS, PERMITS, ETC.
(a) AutoVenu is not in violation of any term or provision of its
Articles of Incorporation or bylaws, or of any material term
or provision of any judgment, decree, order, statute, law,
injunction, rule, ordinance, or governmental regulation that
is applicable to it and where the failure to comply with which
would have a Material Effect.
(b) AutoVenu has maintained in full force and effect all
certificates, licenses, and permits material to the conduct of
its business, and has not received any notification that any
revocation or limitation thereof is threatened or pending.
3.10 BOOKS AND RECORDS. The books and records of AutoVenu (including,
without limitation, the books of account, minute books, and stock
record books) are complete and correct in all material respects and
have been maintained in accordance with sound business practices. The
minute books of AutoVenu are complete and current in all material
respects and, as applicable, accurately reflect all actions taken by
the shareholders and the board of directors of AutoVenu since the date
of inception of AutoVenu, and all signatures contained therein are the
true signatures of the persons whose signatures they purport to be.
3.11 AUTOVENU FINANCIAL STATEMENTS.
(a) The audited balance sheet of AutoVenu as of the most recent
period when delivered, and the related audited statement of
income, statement of cash flow and statement of shareholders
equity for the period then ended, true and complete copies of
which will be delivered to BCS within seventy (70) days from
execution of this Agreement to comply with SEC filing
requirements, present fairly, in all material respects, the
financial position of AutoVenu as at such dates and the
results of operations of AutoVenu for the periods then ended,
in accordance with United States generally accepted accounting
principles ("US GAAP") consistently applied for the period
covered thereby.
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(b) The financial statements referred to in paragraph (a) are
hereinafter referred to as the AUTOVENU FINANCIAL STATEMENTS.
3.12 UNDISCLOSED LIABILITIES. AutoVenu does not have any material direct or
indirect indebtedness, liability, claim, loss, damage, deficiency,
obligation or responsibility, fixed or unfixed, choate or inchoate,
liquidated or unliquidated, secured or unsecured, accrued, absolute,
contingent or otherwise (all of the foregoing being collectively
referred to as "LIABILITIES" and individually as a "LIABILITY"), of a
kind required by US GAAP to be set forth on a financial statement that
is not fully and adequately reflected or reserved against on the
AutoVenu Financial Statements. AutoVenu does not have any Liabilities,
whether or not of a kind required by US GAAP to be set forth on a
financial statement, other than (a) Liabilities incurred in the
ordinary course of business since the date of the latest balance sheet
included in the AutoVenu Financial Statements that are consistent with
past practice and are included in the latest AutoVenu Financial
Statements, (b) Liabilities that are fully reflected on or reserved
against on the latest balance sheet included in the AutoVenu Financial
Statements, or (c) as specifically disclosed in the AutoVenu Financial
Statements.
3.13 TITLE TO PROPERTY; ENCUMBRANCES. AutoVenu has good and indefeasible
title to and other legal right to use all properties and assets, real,
personal and mixed, tangible and intangible, reflected as owned on the
latest balance sheet included in the AutoVenu Financial Statements or
acquired after the date of such balance sheet, except for properties
and assets disposed of in accordance with customary practice in the
business or disposed of for full and fair value since the date of such
balance sheet in the ordinary course of business consistent with past
practice and except for matters that would not have a Material Effect.
3.14 TAXES. All returns, reports, information returns, or other documents
(including any related or supporting information) filed or required to
be filed with any federal, state, local, or foreign governmental entity
or others authority in connection with the determination, assessment or
collection of any Tax (whether or not such Tax is imposed on AutoVenu)
or the administration of any laws, regulations or administrative
requirements relating to any Tax (hereinafter "TAX RETURNS"), reports
and declarations of estimated tax or estimated tax deposit forms
required to be filed by AutoVenu have been duly and timely filed;
AutoVenu has paid all taxes, charges, fees, levies or other assessments
imposed by any federal, state, local or foreign taxing authority,
whether disputed or not, including, without limitation, income,
capital, estimated, excise, property, sales, transfer, withholding,
employment, payroll, and franchise taxes and such terms shall include
any interest, penalties or additions attributable to or imposed on or
with respect to such assessments and any expenses incurred in
connection with the settlement of any tax liability (hereinafter
"TAXES") which have become due whether pursuant to such returns or any
assessment received by it or otherwise, and has paid all installments
of estimated Taxes due; and all Taxes which AutoVenu is required by law
to withhold or to collect have been duly withheld and collected, and
have been paid over to the proper court, tribunal, arbitrator or any
government or political subdivision thereof, whether federal, state,
county, local or foreign, or any agency, authority, official or
instrumentality of any such government or political subdivision
(hereinafter "GOVERNMENTAL OR REGULATORY BODY"). There are no tax liens
upon any of the assets or properties of AutoVenu except for any lien,
pledge, hypothecation, mortgage, security
Share Exchange Agreement-Page 6
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interest,claim, lease, charge, option, right of first refusal,
easement, servitude, transfer restriction under any member or similar
agreement, encumbrance or any other restriction or limitation
whatsoever, other than (i) materialmen's, mechanics', repairmen's or
other like liens arising in the ordinary course of business for amounts
either not yet due or being contested in good faith and by appropriate
proceedings so long as such proceedings shall not involve any material
danger of sale, forfeiture or loss of any part of the assets and shall
have been disclosed to BCS hereunder, or (ii) any lien arising as a
result of any act or omission of BCS (hereinafter "LIENS") for Taxes
not yet due. AutoVenu is not a party to any express tax settlement
agreement, arrangement, policy or guideline, formal or informal (a
"SETTLEMENT AGREEMENT"), and AutoVenu does not have any obligation to
make payments under any Settlement Agreement.
3.15 LITIGATION.
(a) There is no action, proceeding, investigation, or inquiry
pending or, to the best of Autovenu's knowledge, threatened
(i) against or affecting any of Autovenu's assets or business
that, if determined adversely to AutoVenu, would result in a
Material Effect or (ii) that questions this Agreement or any
action contemplated by this Agreement or in connection with
the Share Exchange.
(b) AutoVenu has no knowledge of any state of facts or of the
occurrence or nonoccurrence of any event or group of related
events, that should reasonably cause AutoVenu to determine
that there exists any basis for any material claim against
AutoVenu for any of the matters described in paragraph (a)
above.
3.16 CONTRACTS AND OTHER AGREEMENTS. SECTION 3.16 to the AutoVenu
Shareholder Disclosure Schedule contains a complete and correct list as
of the date hereof of all material agreements, contracts, and
commitments (and all amendments thereto), written or oral, to which
AutoVenu is a party or by which any of its properties is bound.
AutoVenu will make available to BCS complete and correct copies of all
material written agreements, contracts, and commitments, together with
all amendments thereto, and accurate (in all material respects)
descriptions of all material oral agreements. Such agreements,
contracts, and commitments are in full force and effect, and, to the
best of Autovenu's knowledge, all other parties to such agreements,
contracts, and commitments have performed all obligations required to
be performed by them to date thereunder in all material respects and
are not in default thereunder in any material respect.
3.17 ACCOUNTS RECEIVABLE AND ACCOUNTS PAYABLE. All accounts receivable
reflected on the balance sheet of AutoVenu included in the AutoVenu
Financial Statements, and all accounts receivable arising subsequent to
the date of the AutoVenu Financial Statements, (a) have arisen from
BONA FIDE sales transactions in the ordinary course of business on
ordinary trade terms and (b) have been collected or are collectible in
the ordinary course of business in the aggregate recorded amounts
thereof in accordance with their terms without valid set-off or
counterclaim. AutoVenu has made payments on accounts payable and other
current obligations arising subsequent to the date of the AutoVenu
Financial Statements, in accordance with past practice of the business
of AutoVenu.
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3.18 COMPENSATION ARRANGEMENTS; OFFICERS, DIRECTORS AND EMPLOYEES. SECTION
3.18 to the AutoVenu Shareholder Disclosure Schedule sets forth: (a)
the name of all present officers, directors and employees of AutoVenu
and current annual salary, including any promised, expected or
customary bonus or such other amount, and (b) the names and titles of
all directors and officers of AutoVenu. AutoVenu has not made a
commitment or agreement (verbally or in writing) to increase the
compensation or to modify the conditions or terms of employment of any
person listed in SECTION 3.18 to the AutoVenu Shareholder Disclosure
Schedule. To the knowledge of AutoVenu, none of such persons has made a
threat to AutoVenu to terminate such person's relationship with
AutoVenu.
3.19 ERISA. Except as set forth in SECTION 3.19 to the AutoVenu Shareholder
Disclosure Schedule, there are no employee benefit plans as defined in
ERISA ("PLANS") maintained for the benefit of, or covering, any
employee, former employee, independent contractor or former independent
contractor of AutoVenu, or their dependents or their beneficiaries, or
otherwise, now or heretofore contributed to by AutoVenu, and no such
Plan is or has ever been subject to ERISA.
3.20 OPERATIONS. Except as expressly authorized by this Agreement, and
except as set forth in SECTION 3.20 to the AutoVenu Shareholder
Disclosure Schedule, since the date of the latest AutoVenu Financial
Statements, AutoVenu has not:
(a) amended its Certificate of Incorporation or By-Laws or merged
with or into or consolidated with any other entity, or changed
or agreed to rearrange in any manner the character of the
business of AutoVenu;
(b) issued, sold or purchased options or rights to subscribe to,
or entered into any contracts or commitments to issue, sell or
purchase, any shares of its capital stock or other equity
interests;
(c) entered into, amended or terminated any (i) employment
agreement or collective bargaining agreement, (ii) adopted,
entered into or amended any arrangement which is, or would be,
a Plan or (iii) made any change in any actuarial methods or
assumptions used in funding any Plan or in the assumptions or
factors used in determining benefit equivalencies thereunder;
(d) issued any note, bond or other debt security, created,
incurred or assumed any indebtedness for borrowed money other
than in the ordinary course of business in connection with
trade payables, or guaranteed any indebtedness for borrowed
money or any capitalized lease obligation;
(e) declared, set aside or paid any dividends or declared or made
any other distributions of any kind to the shareholders, or
made any direct or indirect redemption, retirement, purchase
or other acquisition of any shares of its capital stock or
other equity interests;
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(f) knowingly waived any right of material value to the business
of AutoVenu;
(g) made any change in its accounting methods or practices or made
any changes in depreciation or amortization policies or rates
adopted by it or made any material write-down of inventory or
material write-off as uncorrectable of accounts receivable;
(h) made any wage or salary increase or other compensation payable
or to become payable or bonus, or increase in any other direct
or indirect compensation, for or to any of its officers,
directors, employees, consultants, agents or other
representatives, or any accrual for or commitment or agreement
to make or pay the same, other than increases made in the
ordinary course consistent with past practice;
(i) entered into any transactions with any of its affiliates,
shareholders, officers, directors, employees, consultants,
agents or other representatives (other than employment
arrangements made in the ordinary course of business
consistent with past practice), or any affiliate of any
shareholder, officer, director, consultant, employee, agent or
other representative;
(j) made any payment or commitment to pay any severance or
termination pay to any person or any of its officers,
directors, employees, consultants, agents or other
representatives, other than payments or commitments to pay
such persons or their officers, directors, employees in the
ordinary course of business;
(k) except in the ordinary course of business, (i) entered into
any lease (as lessor or lessee), (ii) sold, abandoned or made
any other disposition of any of its assets or properties other
than in the ordinary course of business consistent with past
practice, (iii) granted or suffered any Lien on any of its
assets or properties other than sales of inventory in the
ordinary course of business, or (iv) entered into or amended
any material contract or other agreement to which it is a
party, or by or to which it or its assets or properties are
bound or subject, or pursuant to which it agrees to indemnify
any person or to refrain from competing with any person, in
each case or type required to be disclosed pursuant to SECTION
3.15 hereof;
(l) except in the ordinary course of business, incurred or assumed
any debt, obligation or liability (whether absolute or
contingent and whether or not currently due and payable);
(m) except for inventory or equipment acquired in the ordinary
course of business, made any acquisition of all or any part of
the assets, properties, capital stock or business of any other
person;
(n) except in the ordinary course of business, paid, directly or
indirectly, any of its Liabilities before the same became due
in accordance with their terms or otherwise than in the
ordinary course of business, except to obtain the benefit of
discounts available for early payment;
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(o) except in the ordinary course of business, created, incurred
or assumed any indebtedness for borrowed money, or guaranteed
any indebtedness for borrowed money or any capitalized lease
obligation, in each case in excess of $5,000 individually or
in the aggregate;
(p) except in the ordinary course of business, made any capital
expenditures or commitments for capital expenditures in
aggregate amount exceeding $5,000; or
(q) except in the ordinary course of business, terminated, failed
to renew, amended or entered into any contract or other
agreement of a type required to be disclosed pursuant to
SECTION 3.16.
3.21 INTANGIBLE PROPERTY AND INTELLECTUAL PROPERTY. AutoVenu possesses all
of the necessary licenses, trademarks, trade names, domain names,
patents (hereinafter "INTELLECTUAL PROPERTY RIGHTS") necessary to
conduct its business in the manner that is currently being conducted
and anticipates conducting in the future. All of such Intellectual
Property Rights are held in the name of AutoVenu. None of the
Intangible Property of AutoVenu infringes upon the rights of any other
person in any material respect or, to the knowledge of AutoVenu, is so
infringed upon by any other person or its property. AutoVenu has not
received any notice of any claim of any other person relating to any of
the Intangible Property or any process or confidential information of
AutoVenu and does not know of any basis for any such charge or claim.
Except for the Intangible Property, no other material intellectual
property or intangible property rights are required for AutoVenu to
conduct the business of AutoVenu in the ordinary course consistent with
past practice. Except as separately identified in SECTION 3.21 of the
AutoVenu Shareholder Disclosure Schedule, no approval or consent of any
person is needed so that the interest of AutoVenu in the Intangible
Property shall continue to be in full force and effect and enforceable
by AutoVenu following the transactions contemplated by this Agreement.
3.22 EMPLOYEE RELATIONS. AutoVenu is not a party any agreement with any
labor organization, collective bargaining or similar agreement with
respect to its employees. There are no material complaints, grievances
or arbitrations, employment-related litigation, administrative
proceedings or controversies either pending or, to the knowledge of
AutoVenu, threatened, involving any employee, applicant for employment,
or former employee of AutoVenu against AutoVenu. During the past five
years, AutoVenu has not suffered or sustained any labor dispute
resulting in any work stoppage and no such work stoppage is, to the
knowledge of AutoVenu, threatened. To the knowledge of AutoVenu, there
are no attempts presently being made to organize any employees employed
by AutoVenu.
3.23 INSURANCE. AutoVenu has adequate policies of insurance for its
operations. AutoVenu is not in default with respect to any material
provision contained in any policy or binder of insurance and has not
failed to give any notice or present any claim under any such policy or
binder in due and timely fashion. There are no outstanding unpaid
claims under any such policy or binder which have gone unpaid for more
than 45 days or as to which the carrier has disclaimed liability.
AutoVenu has not received any notice of cancellation or non renewal of
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<PAGE>
any such policy or binder. AutoVenu has not received any notice from
any of its insurance carriers that any insurance premiums will be
materially increased in the future or that any existing insurance
coverage will not be available in the future on substantially the same
terms as now in effect.
3.24 LICENSES AND PERMITS. Except as set forth in SECTION 3.24 of the
AutoVenu Shareholder Disclosure Schedule, no material government
permits, licenses, domain name and other registrations, and other
consents and authorizations (federal, state, local and foreign) of any
Governmental or Regulatory Body (collectively, "PERMITS") is required
to be obtained by AutoVenu in connection with its properties or the
business of AutoVenu. AutoVenu has not received any notice of any claim
of revocation of any such Permit and has no knowledge of any event,
which would be likely to give rise to such a claim.
3.25 YEAR 2000 COMPLIANCE. All data of any type that includes date
information or which is otherwise derived from, dependent on or related
to date information ("DATE DATA") and any software, microcode or
hardware system or component, including any electric or electronically
controlled system or component, that processes any Date Data and (a)
that is installed, in development or on order by AutoVenu for its
internal use, or (b) which AutoVenu sells, supports, maintains,
operates, warrants, leases, licenses, assigns or otherwise provides as
an integral part of its products or services (or has sold, supported,
maintained, operated, warranted, leased, licensed, assigned or
otherwise provided in the past as an integral part of its products or
services ("DATE-SENSITIVE SYSTEMS") of AutoVenu are (i) with respect to
Date Data, in proper format and accurate for all dates in the twentieth
and twenty-first centuries, and (ii) with respect to Date-Sensitive
Systems, correctly and accurately processes all Date Data without
interruption before, during and after January 1, 2000, including those
relating to the twentieth and twenty-first centuries, without loss of
any functionality or performance, including but not limited to
calculating, comparing, sequencing, storing and displaying such Date
Data (including all leap year considerations and the quad-centennial
rule), when used as a stand alone system or in combination with other
software or hardware ("YEAR 2000 COMPLIANT").
3.26 BROKERS. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried out by the AutoVenu
Shareholders directly with BCS without the intervention of any other
person on behalf of the AutoVenu Shareholders in such manner as to give
rise to any valid claim by any person against the AutoVenu Shareholders
or BCS for a finder's fee, brokerage commission or similar payment.
3.27 ACQUISITION OF BCS SHARES. Each AutoVenu Shareholder acknowledges that
the shares of BCS Common Stock and BCS Preferred Stock are restricted
securities under the Securities Act and represents that such AutoVenu
Shareholder (i) is acquiring the shares of BCS Common Stock and BCS
Preferred Stock for his own account without a view to distribution
within the meaning of the Securities Act; (ii) has received from BCS
all information that he has deemed necessary to make an informed
investment decision with respect to an investment in BCS in general and
the shares of BCS Common Stock and BCS Preferred Stock in particular;
(iii) is financially able to bear the economic risks of an investment
in BCS; (iv) has such knowledge and experience in financial and
business matters in general
Share Exchange Agreement-Page 11
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and with respect to investments of a nature similar to the shares of
BCS Common Stock and BCS Preferred Stock so as to be capable, by reason
of such knowledge and experience, of evaluating the merits and risks
of, and making an informed business decision with regard to, the
acquisition of the shares of BCS Common Stock and BCS Preferred Stock;
and (v) has received copies of BCS' annual report on Form 10-KSB for
the fiscal year ended December 31, 1999 and quarterly report on Form
10-QSB for the quarter ended March 31, 2000. Each AutoVenu Shareholder
understands and agrees that the certificates evidencing the shares of
BCS Common Stock and BCS Preferred Stock shall bear the usual
restrictive legend pertaining to Rule 144 under the Securities Act and
that the shares of BCS Common Stock and BCS Preferred Stock will not be
transferable except in accordance with a valid exemption from
registration to the satisfaction of the BCS.
3.28 DISCLOSURE. To the knowledge of the AutoVenu Shareholders, neither this
Agreement, nor any Schedule or Exhibit to this Agreement, contains an
untrue statement of a material fact or omits a material fact necessary
to make the statements contained herein or therein not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BCS
Except as expressly set forth and specifically identified by the section number
of this Agreement in the schedule delivered by BCS to the AutoVenu Shareholders
within twenty (20) days from the execution of this Agreement (the "BCS
DISCLOSURE SCHEDULE"), BCS represents, warrants, and covenants to the AutoVenu
Shareholders as follows:
4.1 ORGANIZATION AND QUALIFICATION. BCS is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Colorado and has all requisite corporate power and authority to (a)
own, lease and operate its properties and assets as they are now owned,
leased and operated and (b) carry on its business as currently
conducted and as proposed to be conducted. BCS is duly qualified or
licensed to do business in each jurisdiction in which the failure to be
so qualified or licensed could have a Material Effect.
4.2 CAPITALIZATION. The authorized capital stock of BCS consists of
100,000,000 shares of common stock, no par value, and 10,000,000 shares
of preferred stock, no par value. The issued and outstanding capital
stock of BCS consists of 14,046,080 shares of common stock, no par
value per share. All of the issued and outstanding shares of capital
stock of BCS are validly issued, fully paid, and nonassessable, and
none of such shares have been issued in violation of the preemptive
rights of any person. The shares of BCS Common Stock shall be validly
issued, fully paid, and nonassessable.
4.3 SUBSIDIARIES AND AFFILIATES. BCS does not own or hold, directly or
indirectly, any equity, debt, or other interest in any entity or
business or any option to acquire any such interest.
4.4 OPTIONS OR OTHER RIGHTS. No options, warrants, calls, commitments or
other rights to acquire, sell or issue shares of capital stock or other
equity interests of BCS whether upon conversion of other securities or
otherwise, are issued or outstanding, and there is no
Share Exchange Agreement-Page 12
<PAGE>
agreement or understanding with respect to the voting of such capital
stock or other equity interests.
4.5 VALIDITY AND EXECUTION OF AGREEMENT. The execution and performance of
this Agreement have been duly and validly authorized by the board of
directors of BCS and no other corporate action by BCS is necessary to
authorize the execution, delivery, and performance of this Agreement,
except for the change of the corporate name described in SECTION 6.2
hereof. BCS has the corporate power and authority to execute and
perform this Agreement and to carry out the transactions contemplated
hereby. This Agreement has been duly and validly executed on behalf of
BCS and is a valid and binding obligation of BCS, enforceable in
accordance with its terms, subject to the qualification that
enforcement of the rights and remedies created hereby is subject to (a)
bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting the rights and remedies of creditors and
(b) general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law).
4.6 NO CONFLICT. None of the execution, delivery, or performance of this
Agreement does or will: (a) result in any violation or be in conflict
with or constitute a default under any term or provision of the
Articles of Incorporation or bylaws of BCS or any term or provision of
any judgment, decree, order, statute, injunction, rule, or regulation
applicable to BCS, or of any material note, bond, mortgage, indenture,
lease, license, franchise, agreement, or other instrument or obligation
to which BCS is bound; (b) result in the creation of any Encumbrance
upon any of the properties or assets of BCS pursuant to any such term
or provision; or (c) constitute a default under, terminate, accelerate,
amend or modify, or give any party the right to terminate, accelerate,
amend, modify, abandon, or refuse to perform or comply with, any
material contract, agreement, arrangement, commitment, or plan to which
BCS is a party, or by which BCS or any of its properties or assets may
be subject or bound.
4.7 CONSENTS AND APPROVALS. No federal, state, or other regulatory
approvals are required to be obtained, nor any regulatory requirements
complied with, by BCS in connection with the Share Exchange.
4.8 VIOLATION OF LAWS, PERMITS, ETC.
(a) BCS is not in violation of any term or provision of its
Articles of Incorporation or bylaws, or of any material term
or provision of any judgment, decree, order, statute, law,
injunction, rule, ordinance, or governmental regulation that
is applicable to it and where the failure to comply with which
would have a Material Effect.
(b) BCS has maintained in full force and effect all certificates,
licenses, and permits material to the conduct of its business,
and has not received any notification that any revocation or
limitation thereof is threatened or pending.
4.9 BOOKS AND RECORDS. The books and records of BCS (including, without
limitation, the books of account, minute books, and stock record books)
are complete and correct in all material respects and have been
maintained in accordance with sound business practices.
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The minute books of BCS are complete and current in all material
respects and, as applicable, accurately reflect all actions taken by
the shareholders and the board of directors of BCS since the date of
inception of BCS, and all signatures contained therein are the true
signatures of the persons whose signatures they purport to be.
4.10 BCS FINANCIAL STATEMENTS.
(a) The audited balance sheet of BCS as of December 31, 1999, and
the related audited statement of income, statement of cash
flow and statement of shareholders equity for the year then
ended, and the unaudited balance sheet of BCS as of March 31,
2000 and the related unaudited statement of income, statement
of cash flow and statement of shareholders equity, true and
complete copies of which have been delivered to the AutoVenu
Shareholders, present fairly, in all material respects, the
financial position of BCS as at such dates and the results of
operations of BCS for the periods then ended, in accordance
with US GAAP consistently applied for the periods covered
thereby.
(b) The financial statements referred to in paragraph (a) above
are hereinafter referred to as the BCS FINANCIAL STATEMENTS.
4.11 UNDISCLOSED LIABILITIES. BCS does not have any Liabilities of a kind
required by US GAAP to be set forth on a financial statement that is
not fully and adequately reflected or reserved against on the BCS
Financial Statements. BCS does not have any Liabilities, whether or not
of a kind required by US GAAP to be set forth on a financial statement,
other than (a) Liabilities incurred in the ordinary course of business
since the date of the latest balance sheet included in the BCS
Financial Statements that are consistent with past practice and are
included in the latest BCS Financial Statements, (b) Liabilities that
are fully reflected on or reserved against on the latest balance sheet
included in the BCS Financial Statements, or (c) as specifically
disclosed in the BCS Financial Statements.
4.12 TITLE TO PROPERTY; ENCUMBRANCES. BCS has good and indefeasible title to
and other legal right to use all properties and assets, real, personal
and mixed, tangible and intangible, reflected as owned on the latest
balance sheet included in the BCS Financial Statements or acquired
after the date of such balance sheet, except for properties and assets
disposed of in accordance with customary practice in the business or
disposed of for full and fair value since the date of such balance
sheet in the ordinary course of business consistent with past practice
and except for matters that would not have a Material Effect.
4.13 TAXES. All Tax Returns, reports and declarations of estimated tax or
estimated tax deposit forms required to be filed by BCS have been duly
and timely filed; BCS has paid all Taxes which have become due whether
pursuant to such returns or any assessment received by it or otherwise,
and has paid all installments of estimated Taxes due; and all Taxes
which BCS is required by law to withhold or to collect have been duly
withheld and collected, and have been paid over to the proper
Governmental or Regulatory Body. There are no tax liens upon any of the
assets or properties of BCS except for Liens for Taxes not yet due. BCS
is not a
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<PAGE>
party to any Settlement Agreement, and BCS does not have any obligation
to make payments under any Settlement Agreement.
4.14 LITIGATION.
(a) There is no action, proceeding, investigation, or inquiry
pending or, to the best of BCS's knowledge, threatened (i)
against or affecting any of BCS's assets or business that, if
determined adversely to BCS, would result in a Material Effect
or (ii) that questions this Agreement or any action
contemplated by this Agreement or in connection with the Share
Exchange.
(b) BCS has no knowledge of any state of facts or of the
occurrence or nonoccurrence of any event or group of related
events, that should reasonably cause BCS to determine that
there exists any basis for any material claim against BCS for
any of the matters described in paragraph (a) above.
4.15 CONTRACTS AND OTHER AGREEMENTS. SECTION 4.15 to the BCS Disclosure
Schedule contains a complete and correct list as of the date hereof of
all material agreements, contracts, and commitments (and all amendments
thereto), written or oral, to which BCS is a party or by which any of
its properties is bound. BCS has made available to the AutoVenu
Shareholders complete and correct copies of all material written
agreements, contracts, and commitments, together with all amendments
thereto, and accurate (in all material respects) descriptions of all
material oral agreements. Such agreements, contracts, and commitments
are in full force and effect, and, to the best of BCS's knowledge, all
other parties to such agreements, contracts, and commitments have
performed all obligations required to be performed by them to date
thereunder in all material respects and are not in default thereunder
in any material respect.
4.16 COMPENSATION ARRANGEMENTS; OFFICERS, DIRECTORS AND EMPLOYEES. BCS does
not pay any compensation to any of its officers and directors and has
no employees. BCS has not made a commitment or agreement (verbally or
in writing) to pay any compensation to such persons.
4.17 ERISA. There are no Plans maintained for the benefit of, or covering,
any employee, former employee, independent contractor or former
independent contractor of BCS or their dependents or their
beneficiaries, or otherwise, now or heretofore contributed to by BCS
and no such Plan is or has ever been subject to ERISA.
4.18 OPERATIONS. Except as expressly authorized by this Agreement, or except
as set forth in SECTION 4.18 to the BCS Disclosure Schedule, since the
date of the latest BCS Financial Statements, BCS has not:
(a) amended its Articles of Incorporation or By-Laws or merged
with or into or consolidated with any other entity, or changed
or agreed to rearrange in any manner the character of the
business of BCS;
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(b) issued, sold or purchased options or rights to subscribe to,
or entered into any contracts or commitments to issue, sell or
purchase, any shares of its capital stock or other equity
interests;
(c) entered into, amended or terminated any (i) employment
agreement or collective bargaining agreement, (ii) adopted,
entered into or amended any arrangement which is, or would be,
a Plan or (iii) made any change in any actuarial methods or
assumptions used in funding any Plan or in the assumptions or
factors used in determining benefit equivalencies thereunder;
(d) issued any note, bond or other debt security, created,
incurred or assumed any indebtedness for borrowed money other
than in the ordinary course of business in connection with
trade payables, or guaranteed any indebtedness for borrowed
money or any capitalized lease obligation;
(e) declared, set aside or paid any dividends or declared or made
any other distributions of any kind to the shareholders, or
made any direct or indirect redemption, retirement, purchase
or other acquisition of any shares of its capital stock or
other equity interests;
(f) knowingly waived any right of material value to the business
of BCS;
(g) made any change in its accounting methods or practices or made
any changes in depreciation or amortization policies or rates
adopted by it or made any material write-down of inventory or
material write-off as uncorrectable of accounts receivable;
(h) made any wage or salary increase or other compensation payable
or to become payable or bonus, or increase in any other direct
or indirect compensation, for or to any of its officers,
directors, employees, consultants, agents or other
representatives, or any accrual for or commitment or agreement
to make or pay the same, other than increases made in the
ordinary course consistent with past practice;
(i) entered into any transactions with any of its affiliates,
shareholders, officers, directors, employees, consultants,
agents or other representatives (other than employment
arrangements made in the ordinary course of business
consistent with past practice), or any affiliate of any
shareholder, officer, director, consultant, employee, agent or
other representative;
(j) made any payment or commitment to pay any severance or
termination pay to any person or any of its officers,
directors, employees, consultants, agents or other
representatives, other than payments or commitments to pay
such persons or their officers, directors, employees in the
ordinary course of business;
(k) except in the ordinary course of business, (i) entered into
any lease (as lessor or lessee), (ii) sold, abandoned or made
any other disposition of any of its assets or
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properties other than in the ordinary course of business
consistent with past practice, (iii) granted or suffered any
Lien on any of its assets or properties other than sales of
inventory in the ordinary course of business, or (iv) entered
into or amended any material contract or other agreement to
which it is a party, or by or to which it or its assets or
properties are bound or subject, or pursuant to which it
agrees to indemnify any person or to refrain from competing
with any person, in each case or type required to be disclosed
pursuant to SECTION 4.14 hereof;
(l) except in the ordinary course of business, incurred or assumed
any debt, obligation or liability (whether absolute or
contingent and whether or not currently due and payable);
(m) except for inventory or equipment acquired in the ordinary
course of business, made any acquisition of all or any part of
the assets, properties, capital stock or business of any other
person;
(n) except in the ordinary course of business, paid, directly or
indirectly, any of its Liabilities before the same became due
in accordance with their terms or otherwise than in the
ordinary course of business, except to obtain the benefit of
discounts available for early payment;
(o) except in the ordinary course of business, created, incurred
or assumed any indebtedness for borrowed money, or guaranteed
any indebtedness for borrowed money or any capitalized lease
obligation, in each case in excess of $5,000 individually or
in the aggregate;
(p) except in the ordinary course of business, made any capital
expenditures or commitments for capital expenditures in
aggregate amount exceeding $5,000; or
(q) except in the ordinary course of business, terminated, failed
to renew, amended or entered into any contract or other
agreement of a type required to be disclosed pursuant to
SECTION 4.15.
4.19 YEAR 2000 COMPLIANCE. All Date Data and Date-Sensitive Systems of BCS
are Year 2000 Compliant.
4.20 BROKERS. All negotiations relating to this Agreement and the
transactions contemplated hereby have been carried out by the AutoVenu
Shareholders directly with BCS without the intervention of any other
person on behalf of the AutoVenu Shareholders in such manner as to give
rise to any valid claim by any person against the AutoVenu Shareholders
or BCS for a finder's fee, brokerage commission or similar payment.
4.21 APPROVAL OF SHARE EXCHANGE. The board of directors of BCS has approved
the Share Exchange without reservation or qualification.
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4.22 SEC REPORTING STATUS. The common stock of BCS is registered pursuant to
Section 12(g) of the Securities Exchange Act of 1934. Accordingly, BCS
is a reporting company with the Securities and Exchange Commission. BCS
has filed all of the reports required to be filed with the Securities
and Exchange Commission.
4.23 INVESTMENT COMPANY. BCS is not an investment company within the meaning
of Section 3 of the Investment Company Act.
4.24 OTC BULLETIN BOARD STATUS. The shares of BCS Common Stock are approved
for trading on the OTC Bulletin Board.
4.25 DISCLOSURE. To the knowledge of BCS, neither this Agreement, nor any
Schedule or Exhibit to this Agreement, contains an untrue statement of
a material fact or omits a material fact necessary to make the
statements contained herein or therein not misleading.
ARTICLE V
ACTIONS PRIOR TO CLOSING
5.1 CORPORATE EXAMINATIONS AND INVESTIGATIONS. From the execution of the
this Agreement until the Closing Date, BCS shall be entitled to make
such investigation of the assets, properties, agreements, business and
operations of AutoVenu and such examination of the books, records, Tax
Returns, financial condition and operations of AutoVenu, and to
otherwise complete BCS's feasibility review of acquiring AutoVenu. Any
such investigation and examination shall be conducted at reasonable
times and under reasonable circumstances and AutoVenu shall cooperate
fully therein. In order that BCS may have full opportunity to make such
a business, accounting and legal review, examination or investigation
as they may wish of the business and affairs of AutoVenu, AutoVenu
shall furnish to BCS during such period all such information and copies
of such documents concerning the affairs of AutoVenu as BCS may
reasonably request and cause Autovenu's officers, employees,
consultants, agents, accountants and attorneys to fully cooperate with
BCS and disclose all material facts affecting the financial condition
and business operations of AutoVenu. AutoVenu, upon notice, may, but
has no obligation to, address the issues raised by BCS during this
feasibility review period. In the event that BCS is not satisfied with
any document or issue concerning the operations or business of
AutoVenu, or any matter related to this Agreement, BCS may, for any
reason, in its sole discretion, at any time prior to Closing, give
written notice of termination to AutoVenu and the AutoVenu
Shareholders, and all parties shall be released from any obligation or
further liabilities under this Agreement.
Until the Closing and if the Closing shall not occur, thereafter, BCS
and its affiliates shall keep confidential and shall not use in any
manner inconsistent with the transactions contemplated by this
Agreement and after termination of this Agreement, BCS and its
affiliates shall not disclose, nor use for their own benefit, any
information or documents obtained from AutoVenu concerning its assets,
properties, business and operations, unless (a) readily ascertainable
from public or published information, or trade sources, (b) received
from a third party not under an obligation to AutoVenu to keep such
information confidential
Share Exchange Agreement-Page 18
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or (c) required by any Law or Order. If this transaction does not close
for any reason, BCS and its affiliates shall return or destroy all such
confidential information and compilations thereof as is practicable,
and shall certify such destruction or return to AutoVenu.
5.2 CONDUCT OF BUSINESS. From the date hereof through the Closing Date, the
AutoVenu Shareholders shall cause the business of AutoVenu to be
conducted in the ordinary course in the same manner as it has been
conducted since it inception. The AutoVenu Shareholders covenant that,
except with the prior written consent of BCS, which consent shall not
be unreasonably withheld, AutoVenu will not:
(a) Do any of the restricted acts set forth in SECTION 3.20
hereof, or enter into any agreement of a nature set forth in
SECTION 3.16 hereof; or
(b) Enter into any transaction other than in the ordinary course
of business.
5.3 PRESERVATION OF BUSINESS. From the date hereof through the Closing
Date, the AutoVenu Shareholders shall cause AutoVenu to use
commercially reasonable efforts to (i) preserve intact the business,
assets, properties and organizations of AutoVenu, (ii) keep available
the services of the present officers, employees, consultants and agents
of AutoVenu; and (iii) maintain the present suppliers and customers and
preserve the goodwill of AutoVenu.
5.4 ADVICE OF CHANGES. The AutoVenu Shareholders will promptly advise BCS
in writing from time to time prior to the Closing with respect to any
matter hereafter arising and known to them that, if existing or
occurring at the date of this Agreement, would have been required to be
set forth or described in the AutoVenu Shareholder Disclosure Schedule
or would have resulted in any representation of the AutoVenu
Shareholders in this Agreement being untrue. BCS will promptly advise
the AutoVenu Shareholders in writing from time to time prior to the
Closing with respect to any matter hereafter arising and known to it
that, if existing or occurring at the date of this Agreement, would
have been required to be set forth or described in the BCS Disclosure
Schedule or would have resulted in any representation of BCS in this
Agreement being untrue in any material respect.
5.5 OTHER AGREEMENTS. The AutoVenu Shareholders and BCS agree to take, or
cause to be taken, all actions and to do, or cause to be done, all
things reasonably necessary, proper or advisable to consummate and make
effective as promptly as practicable the transactions contemplated by
this Agreement, including, without limitation, the obtaining of all
necessary waivers, consents and approvals and the effecting of all
necessary registrations and filings, including, but not limited to,
submissions of information requested by Governmental or Regulatory
Bodies and any other persons required to be obtained by them for the
consummation of the closing and the continuance in full force and
effect of the permits, contracts and other agreements set forth on the
Schedules to this Agreement.
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ARTICLE VI
CONDITIONS PRECEDENT TO CLOSING
6.1 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BCS TO COMPLETE THE CLOSING.
The obligations of BCS to enter into and complete the Closing are
subject to the fulfillment of the following conditions, any one or more
of which may be waived by BCS:
(a) (i) All of the terms, covenants, and conditions of this
Agreement to be complied with or performed by the AutoVenu
Shareholders at or before the Closing shall have been duly
complied with and performed in all material respects, to the
sole satisfaction of BCS, (ii) the representations and
warranties of the AutoVenu Shareholders set forth in Article
III shall be true in all material respects on and as of the
Closing Date with the same force and effect as if such
representations and warranties had been made on and as of the
Closing, and (iii) BCS shall have received a certificate to
such effect from the AutoVenu Shareholders.
(b) All consents, waivers, approvals, licenses, authorizations of,
or filings or declarations with third parties or Governmental
or Regulatory Bodies required to be obtained by AutoVenu or
the AutoVenu Shareholders in order to permit the transactions
contemplated by this Agreement to be consummated in accordance
with agreements and court orders applicable to AutoVenu or the
AutoVenu Shareholders and applicable governmental laws, rules,
regulations and agreements shall have been obtained and any
waiting period thereunder shall have expired or been
terminated, and AutoVenu shall have received a certificate
from the AutoVenu Shareholders to such effect.
(c) All actions, proceedings, instruments, and documents in
connection with the consummation of the transactions
contemplated by this Agreement, including the forms of all
documents, legal matters, opinions, and procedures in
connection therewith, shall have been approved in form and
substance by counsel for BCS.
(d) The AutoVenu Shareholders shall have furnished such
certificates to evidence compliance with the conditions set
forth in this Article, as may be reasonably requested by BCS
or its counsel.
(e) AutoVenu shall not have suffered any Material Effect.
(f) No material information or data provided or made available to
BCS by or on behalf of AutoVenu shall be incorrect in any
material respect.
(g) No investigation and no suit, action, or proceeding before any
court or any governmental or regulatory authority shall be
pending or threatened by any state or federal governmental or
regulatory authority, against AutoVenu or any of its
affiliates, associates, officers, or directors seeking to
restrain, prevent, or change in any material respect the
transactions contemplated hereby or seeking damages in
connection with such transactions that are material to
AutoVenu.
Share Exchange Agreement-Page 20
<PAGE>
(h) Counsel to AutoVenu and/or the AutoVenu Shareholders shall
have delivered to BCS on and as of the Closing Date an opinion
to BCS substantially as to the matters set forth in SECTIONS
3.1, 3.2, 3.3, 3.4, 3.6. 3.7, AND 3.8, all subject to
customary limitations reasonably acceptable to counsel to BCS.
(i) The following key employees ("KEY EMPLOYEES") shall have
entered into at least two-year employment agreements on terms
satisfactory to BCS: [to be provided within twenty (20) days
of executing this Agreement.] These EMPLOYMENT AGREEMENTS
shall contain provisions as to a year-end performance bonus
based on standards to be established by the directors of BCS,
incentive stock options with minimum guarantees, the
repurchase of BCS shares of Common Stock in the event of
termination of employment, and customary non-compete and
proprietary information provisions.
(j) Each officer and Key Employee shall have entered into a
proprietary information and non-compete agreement on terms
satisfactory to BCS.
(k) The AutoVenu Shareholders shall have provided audited
financial statements of AutoVenu covering the latest completed
periods in a form suitable for filing with the SEC.
(l) BCS shall have completed corporate examination and
investigation to its satisfaction as provided under SECTION
5.1 hereof.
6.2 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE AUTOVENU SHAREHOLDERS TO
COMPLETE THE CLOSING. The obligations of the AutoVenu Shareholders to
enter into and complete the Closing are subject to the fulfillment on
or prior to the Closing Date, of the following conditions, any one or
more of which may be waived by the AutoVenu Shareholders:
(a) (i) All of the terms, covenants, and conditions of this
Agreement to be complied with or performed by BCS at or before
the Closing shall have been duly complied with and performed
in all material respects, (ii) the representations and
warranties of BCS set forth in Article IV shall be true in all
material respects on and as of the Closing Date with the same
force and effect as if such representations and warranties had
been made on and as of the Closing, and (iii) the AutoVenu
Shareholders shall have received a certificate to such effect
from BCS.
(b) All consents, waivers, approvals, licenses, authorizations of,
or filings or declarations with third parties or Governmental
or Regulatory Bodies required to be obtained by BCS in order
to permit the transactions contemplated by this Agreement to
be consummated in accordance with agreements and court orders
applicable to BCS and applicable governmental laws, rules,
regulations and agreements shall have been obtained and any
waiting period thereunder shall have expired or been
terminated, and the AutoVenu Shareholders shall have received
a certificate from BCS to such effect.
Share Exchange Agreement-Page 21
<PAGE>
(c) All actions, proceedings, instruments, and documents in
connection with the consummation of the transactions
contemplated by this Agreement, including the forms of all
documents, legal matters, opinions, and procedures in
connection therewith, shall have been approved in form and
substance by counsel for the AutoVenu Shareholders, which
approval shall not be unreasonably withheld.
(d) BCS shall have furnished such certificates to evidence
compliance with the conditions set forth in this Article, as
may be reasonably requested by the AutoVenu Shareholders or
their counsel.
(e) BCS shall not have suffered any Material Effect.
(f) No material information or data provided or made available to
the AutoVenu Shareholders by or on behalf of BCS shall be
incorrect in any material respect.
(g) No investigation and no suit, action, or proceeding before any
court or any governmental or regulatory authority shall be
pending or threatened by any state or federal governmental or
regulatory authority, against BCS or any of its affiliates,
associates, officers, or directors seeking to restrain,
prevent, or change in any material respect the transactions
contemplated hereby or seeking damages in connection with such
transactions that are material to BCS.
(h) Counsel to BCS shall have delivered to the AutoVenu
Shareholders on and as of the Closing Date an opinion to the
AutoVenu Shareholders substantially as to the matters set
forth in SECTIONS 4.1, 4.2, 4.3, 4.4, 4.5, 4.6., AND 4.7, all
subject to customary limitations reasonably acceptable to
counsel to the AutoVenu Shareholders.
(i) BCS and AutoVenu shall mutually agree for BCS to reserve the
following corporate name: Crossnet Communications, Inc. or
such other name as the parties may mutually agree upon.
(j) BCS shall file Articles of Amendment to its Articles of
Incorporation with the Secretary of State of the State of
Colorado to establish the name change.
ARTICLE VII
POST-CLOSING COVENANTS
The parties covenant to take the following actions after the Closing Date:
7.1 FURTHER INFORMATION. Following the Closing, each party will afford to
the other party, its counsel and its accountants, during normal
business hours, reasonable access to the books, records and other data
of AutoVenu or BCS, as the case may be, relating to the business of
AutoVenu or BCS in their possession with respect to periods prior to
the Closing and the right to make copies and extracts therefrom, to the
extent that such access may be reasonably required by the requesting
party (a) to facilitate the investigation, litigation and final
Share Exchange Agreement-Page 22
<PAGE>
disposition of any claims which may have been or may be made against
any party or its affiliates and (b) for any other reasonable business
purpose.
7.2 RECORD RETENTION. Each party agrees that for a period of not less than
five years following the Closing Date, such party shall not destroy or
otherwise dispose of any of the Books and Records of AutoVenu or BCS
relating to the business of AutoVenu or BCS in his or its possession
with respect to periods prior to the Closing Date. Each party shall
have the right to destroy all or part of such Books and Records after
the fifth anniversary of the Closing Date or, at an earlier time by
giving each other party hereto 30 days prior written notice of such
intended disposition and by offering to deliver to the other party or
parties, at the other party's or parties' expense, custody of such
Books and Records as such party may intend to destroy.
7.3 POST-CLOSING ASSISTANCE. The AutoVenu Shareholders on the one hand, and
BCS, on the other hand, will provide each other with such assistance as
may reasonably be requested in connection with the preparation of any
Tax Return, any audit or other examination by any taxing authority, or
any judicial or administrative proceedings relating to liability for
Taxes, and each will retain and provide the requesting party with any
records or information that may be reasonably relevant to such return,
audit or examination, proceedings or determination. The party
requesting assistance shall reimburse the other party for reasonable
out-of-pocket expenses incurred in providing such assistance. Any
information obtained pursuant to this SECTION 7.3 or pursuant to any
other Section hereof providing for the sharing of information or the
review of any Tax Return or other schedule relating to Taxes shall be
kept confidential by the parties hereto.
7.4 SEC REPORTING. With a view to making available the benefits of certain
rules and regulations of the SEC which may at any time permit the sale
of the BCS shares of Common Stock to the public without registration,
from and after the Closing, the new management of BCS will:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act,
at all times; and
(b) file with the SEC in a timely manner all reports and other
documents required of BCS and of them under the Exchange Act.
ARTICLE VIII
SURVIVAL : INDEMNIFICATION
8.1 SURVIVAL OF AGREEMENTS, REPRESENTATIONS AND WARRANTIES. Notwithstanding
any investigation conducted or notice or knowledge obtained by or on
behalf of any party hereto, each agreement in this Agreement shall
survive the Closing without limitation as to time until fully performed
and each representation and warranty in this Agreement or in the
Exhibits, Schedules or certificates delivered pursuant to this
Agreement shall survive the Closing for a period of two years (other
than the representations and warranties contained in SECTION 3.5 which
shall survive the Closing without limitation as to time, and other than
the
Share Exchange Agreement-Page 23
<PAGE>
representations and warranties contained in SECTION 3.14, which shall
survive the Closing until the earlier of (i) three and one-half years
from the Closing Date and (ii) three years following the date on which
Tax files the Tax Return relating to the taxable period from December
31, 1999 through the Closing Date). Notice must be given to the party
from whom indemnification is sought of any claim for indemnification
under Article VIII prior to the termination of the relevant survival
period.
8.2 INDEMNIFICATION BY THE AUTOVENU SHAREHOLDERS. From and after the
Closing Date, the AutoVenu Shareholders agree jointly and severally, to
indemnify, hold harmless, protect and defend BCS and its affiliates
(and their respective directors, officers, agents and employees,
successors and assigns) in accordance with the provisions of this
Article VIII from and against:
(a) any and all damages incurred by any of them arising out of,
relating to or based upon or in connection with any inaccuracy
in, or breach of, any of the representations or warranties,
covenants or agreements of any of the AutoVenu Shareholders or
AutoVenu contained in or incorporated into this Agreement, in
the Schedules hereto or in certificates delivered pursuant to
this Agreement;
(b) any and all Taxes (other than to the extent such Taxes are
reflected in the AutoVenu balance sheet included in the
AutoVenu Financial Statements) imposed on AutoVenu in respect
of its income, business, property or operations or for which
AutoVenu may otherwise be liable for any period ending or
deemed to end prior to or on the date of the AutoVenu
Financial Statements; and
(c) any cost incurred by AutoVenu in connection with this
Agreement and the transactions contemplated hereby.
The right of the parties to be indemnified hereunder shall not be
limited or affected by any investigation conducted or notice or
knowledge obtained by or on behalf of any such persons.
8.3 BCS'S INDEMNITY. BCS shall indemnify the AutoVenu Shareholders and hold
the AutoVenu Shareholders harmless against and in respect of any and
all damages, losses, claims, penalties, liabilities, costs and expenses
(including, without limitation, all fines, interest, reasonable legal
fees and expenses and amounts paid in settlement), that arise from or
relate or are attributable to (and without giving effect to any tax
benefit to the indemnified party) (a) any misrepresentation by BCS or
breach of any warranty by BCS in this Agreement and (b) any breach of
any covenant or agreement on the part of BCS in this Agreement.
8.4 METHOD OF ASSERTING CLAIMS. The party making a claim under this Article
VIII is referred to as the "INDEMNIFIED PARTY" and the party against
whom such claims are asserted under this Article VIII is referred to as
the "INDEMNIFYING PARTY". All claims by any Indemnified Party under
this Article VIII shall be asserted and resolved as follows:
Share Exchange Agreement-Page 24
<PAGE>
(a) Whenever an Indemnified Party becomes aware of a claim for
which an Indemnifying Party would be liable to an Indemnified
Party hereunder, the Indemnified Party shall with reasonable
promptness notify in writing the Indemnifying Party of such
claim, identifying the representation or warranty on which
such claim is based, the basis for such claim or demand, and
the amount or the estimated amount thereof to the extent then
determinable (which estimate shall not be conclusive of the
final amount of such claim and demand; the "CLAIM NOTICE");
PROVIDED, that any failure to give a Claim Notice will not be
deemed a waiver of any rights of the Indemnified Party except
to the extent the rights of the Indemnifying Party are
actually prejudiced by such failure. If the basis of such
claim is a claim or demand by a third party, the Indemnifying
Party, upon request of the Indemnified Party, shall retain
counsel (who shall be reasonably acceptable to the Indemnified
Party) to represent the Indemnified Party and shall pay the
reasonable fees and disbursements of such counsel with regard
thereto; PROVIDED, that any Indemnified Party is hereby
authorized prior to the date on which it receives written
notice from the Indemnifying Party designating such counsel,
to retain counsel, whose fees and expenses shall be at the
expense of the Indemnifying Party, to file any motion, answer
or other pleading and take such other action which it
reasonably shall deem necessary to protect its interests or
those of the Indemnifying Party until the date on which the
Indemnified Party receives such notice from the Indemnifying
Party. After the Indemnifying Party shall retain such counsel,
the Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party unless (x) the
Indemnifying Party and the Indemnified Party shall have
mutually agreed to the retention of such counsel or (y)
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests
between them. The Indemnifying Party shall not, in connection
with any proceedings or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than
one such firm for the Indemnified Party (except to the extent
the Indemnified Party retained counsel to protect its (or the
Indemnifying Party's) rights prior to the selection of counsel
by the Indemnifying Party). If requested by the Indemnifying
Party, the Indemnified Party agrees to cooperate with the
Indemnifying Party and its counsel in contesting any claim or
demand, which the Indemnifying Party defends. Neither party
may settle a claim or demand without the prior written consent
of the other party (which consent will not be unreasonably
withheld) unless, as part of such settlement, the Indemnified
Party shall receive a full and unconditional release
reasonably satisfactory to the Indemnifying Party.
(b) Whenever any Indemnified Party shall have a claim against any
Indemnifying Party hereunder which does not involve a claim or
demand being asserted against or sought to be collected from
it by a third party, the Indemnified Party shall send a Claim
Notice with respect to such claim to the Indemnifying Party.
(c) After delivery of a Claim Notice, so long as any right to
indemnification exists pursuant to this Article VIII, the
affected parties each agree to retain all Books and Records
related to such Claim Notice. In each instance, the
Indemnified Party shall
Share Exchange Agreement-Page 25
<PAGE>
have the right to be kept fully informed by the Indemnifying
Party and its legal counsel with respect to any legal
proceedings. Any information or documents made available to
any party hereunder and designated as confidential by the
party providing such information or documents and which is not
otherwise generally available to the public and not already
within the knowledge of the party to whom the information is
provided (unless otherwise covered by the confidentiality
provisions of any other agreement among the parties hereto, or
any of them), and except as may be required by applicable law,
shall not be disclosed to any third person (except for the
representatives of the party being provided with the
information, in which event the party being provided with the
information shall request its representatives not to disclose
any such information which it otherwise required hereunder to
be kept confidential).
8.5 GENERAL PROVISIONS. The following general provisions shall apply to any
claim for indemnification under this Article VIII:
(a) The amount of any claim subject to indemnification shall be
determined after taking into account the present value of any
tax benefits (net of tax detriments) accruing to the
Indemnified Party or any affiliate as a result of such claim.
(b) Except as otherwise set forth in this Section 8.5(b), with
respect to any breach, violation or nonfulfillment of or
default in the performance of any representation, warranty or
covenant of this Agreement for which a right to claim
indemnification is provided in this Article VIII, after the
Closing a claim or an action under and pursuant to the terms,
conditions and limitations of this Article VIII shall be the
sole and exclusive right and remedy of BCS and the AutoVenu
Shareholders and neither BCS nor any AutoVenu Shareholder
shall have any other claim, cause of action, right, or remedy
for such breach, violation, non-fulfillment or default against
the other based upon this Agreement, any provision of any
federal or state securities or other statute, law, rule or
regulation or based upon any other cause of action arising at
law or in equity; PROVIDED, that if for any reason a court of
competent jurisdiction shall refuse to enforce this provision,
and shall permit BCS or the AutoVenu Shareholders to assert
any action based other than upon the right to claim
indemnification as provided in this Article VIII, BCS and the
AutoVenu Shareholders agree that the amount of such other
claim shall be subject to and limited by the provisions of
this Article VIII. The provisions of this Section 8.5(b) shall
not preclude the prosecution of any action or proceeding based
on fraud that, if found to exist, would be sufficient to give
rise to the right of rescission with respect to the
transactions contemplated by this Agreement.
ARTICLE IX
TERMINATION OF AGREEMENT
9.1 TERMINATION. This Agreement may be terminated at any time prior to the
Closing as follows:
Share Exchange Agreement-Page 26
<PAGE>
(a) by mutual written consent of BCS and the AutoVenu
Shareholders;
(b) by BCS on the one hand, or by all of the AutoVenu
Shareholders, on the other hand, by written notice to the
other party hereto, if the Closing shall not have occurred on
the date as established pursuant to SECTION 2.1 hereof (unless
such event has been caused by a breach of this Agreement by
the party seeking such termination);
(c) by BCS or by all of the AutoVenu Shareholders if a
Governmental or Regulatory Body has permanently enjoined or
prohibited consummation of the Share Exchange and such court
or government action is final and nonappealable;
(d) by BCS if the AutoVenu Shareholders have failed to comply in
any material respect with any of its covenants or agreements
under this Agreement that are required to be complied with
prior to the date of such termination;
(e) by BCS for any reason whatsoever as provided by SECTION 5.1
hereof; or
(f) by the AutoVenu Shareholders if BCS has failed to comply in
any material respect with any of its covenants or agreements
under this Agreement that are required to be complied with
prior to the date of such termination.
Should the AutoVenu Shareholders terminate this Agreement for any
reason other than a default by BCS as described in SECTION 9.1(F)
hereof, the AutoVenu Shareholders shall be jointly and severally liable
for all damages caused by the failure to close and not just the
expenses listed in SECTION 10.1 hereof. Should BCS terminate this
Agreement for any reason other than a default by the AutoVenu
Shareholders as described in SECTION 9.1(D) hereof, or as allowed by
SECTION 5.1 hereof, then BCS shall be liable for all damages caused by
the failure to close and not just the expenses listed in SECTION 10.1.
hereof.
9.2 SURVIVAL AFTER TERMINATION. If this Agreement is terminated pursuant to
SECTION 9.1, (a) this Agreement shall become null and void and of no
further force and effect, except for the provisions of SECTION 5.1
relating to the obligation to keep confidential certain information and
(b) there shall be no liability on the part of the AutoVenu
Shareholders or BCS or their respective affiliates.
ARTICLE X
MISCELLANEOUS
10.1 EXPENSES. BCS shall be solely responsible for its own legal and
accounting fees in connection with the Share Exchange. AutoVenu shall
be responsible for legal and accounting fees and other expenses in
connection with the Share Exchange as it relates to AutoVenu.
10.2 FURTHER ASSURANCES. At any time and from time to time after the Closing
Date at the request of BCS, and without further consideration, the
AutoVenu Shareholders will execute and deliver such other instruments
of sale, transfer, conveyance, assignment and
Share Exchange Agreement-Page 27
<PAGE>
confirmation and take such other action as BCS may reasonably deem
necessary or desirable in order to transfer, convey and assign the
Shares to BCS and to assist BCS in exercising all rights with respect
thereto. The parties shall use their best efforts to fulfill or obtain
the fulfillment of the conditions to the Closing, including, without
limitation, the execution and delivery of any document or other papers,
the execution and delivery of which are conditions precedent to the
Closing.
10.3 NOTICES. All notices, requests, demands and other communications
required or permitted to be given hereunder shall be in writing and
shall be given personally, sent by facsimile transmission or sent by
prepaid air courier or certified or express mail, postage prepaid. Any
such notice shall be deemed to have been given (a) when received, if
delivered in person, sent by facsimile transmission and confirmed in
writing within three (3) business days thereafter or sent by prepaid
air courier or (b) three (3) business days following the mailing
thereof, if mailed by certified first class mail, postage prepaid,
return receipt requested, in any such case as follows (or to such other
address or addresses as a party may have advised the other in the
manner provided in this SECTION 10.3):
If to the AutoVenu Shareholders:
Mark Moldenhauer
14500 N. Northsight Blvd., Suite 213
Scottsdale, AZ 85260
If to BCS:
BCS Investment Corporation
1708 Dolphin Avenue, Suite 400
Kelowna, British Columbia V1Y 9S4 Canada
Attention: Nicholas Miller, President
with a copy to:
Dill Dill Carr Stonbraker & Hutchings, P.C.
455 Sherman Street, Suite 300
Denver, Colorado 80203
Attention: Fay M. Matsukage, Esq.
10.4 ARBITRATION. Any dispute, controversy, or claim arising out of,
relating to, or in connection with, this Agreement or the agreements or
transactions contemplated by this Agreement shall be finally settled by
binding arbitration. The arbitration shall be conducted and the
arbitrator chosen in accordance with the rule of the American
Arbitration Association in effect at the time of the arbitration,
except as they may be modified herein or by mutual agreement of BCS and
the AutoVenu Shareholders. In connection with any such arbitration,
each party shall be afforded the opportunity to conduct discovery in
accordance with the Federal Rules of Civil Procedure.
Share Exchange Agreement-Page 28
<PAGE>
(a) The seat of the arbitration shall be in Denver, Colorado, and
will follow the format known as ABaseball Arbitration@. Each
of the AutoVenu Shareholders and BCS hereby irrevocably
submits to the jurisdiction of the arbitrator in Denver,
Colorado, and waives any defense in an arbitration based upon
any claim that such party is not subject personally to the
jurisdiction of such arbitrator, that such arbitration is
brought in an inconvenient format, or that such venue is
improper.
(b) The arbitral award shall be in writing and shall be final and
binding on each of the parties to this Agreement. The award
may include an award of costs, including reasonable attorneys'
fees and disbursements. Any court having jurisdiction thereof
or having jurisdiction over the parties or their assets may
enter judgment upon the award. Each of the AutoVenu
Shareholders and BCS acknowledges and agrees that by agreeing
to these arbitration provisions each of the parties hereto is
waiving any right that such party may have to a jury trial
with respect to the resolution of any dispute under this
Agreement or the agreements or transactions contemplated
hereby.
10.5 PUBLICITY. No publicity release or announcement concerning this
Agreement or the transactions contemplated hereby shall be made without
advance approval thereof by BCS and the AutoVenu Shareholders except as
may be required by applicable law.
10.6 ENTIRE AGREEMENT. This Agreement (including the Exhibits and Schedules)
and the agreements, certificates and other documents delivered pursuant
to this Agreement contain the entire agreement among the parties with
respect to the transactions described herein, and supersede all prior
agreements, written or oral, with respect thereto.
10.7 WAIVERS AND AMENDMENTS. This Agreement may be amended, superseded,
canceled, renewed or extended, and the terms hereof may be waived, only
by a written instrument signed by the parties or, in the case of a
waiver, by the party waiving compliance. No delay on the part of any
party in exercising any right, power or privilege hereunder shall
operate as a waiver thereof
10.8 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado without regard to
principles of conflicts of law.
10.9 BINDING EFFECT, NO ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns. This Agreement is not assignable by any party hereto
without the prior written consent of the other parties hereto except by
operation of law and any other purported assignment shall be null and
void.
10.10 COUNTERPARTS. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together
constitute one and the same instrument. Each counterpart may consist of
a number of copies hereof each signed by less than all, but together
signed by all of the parties hereto.
10.11 EXHIBITS AND SCHEDULES. The Exhibits and Schedules are a part of this
Agreement as if fully set forth herein. All references herein to
Sections, subsections, clauses, Exhibits and
Share Exchange Agreement-Page 29
<PAGE>
Schedules shall be deemed references to such parts of this Agreement,
unless the context shall otherwise require.
10.12 EFFECT OF DISCLOSURE ON SCHEDULES. Any item disclosed on any Schedule
to this Agreement shall only be deemed to be disclosed in connection
with (a) the specific representation and warranty to which such
Schedule is expressly referenced, (b) any specific representation and
warranty which expressly cross-references such Schedule and (c) any
specific representation and warranty to which any other Schedule to
this Agreement is expressly referenced if such other Schedule expressly
cross-references such Schedule.
10.13 HEADINGS. The headings in this Agreement are for reference only, and
shall not affect the interpretation of this Agreement.
10.14 SEVERABILITY OF PROVISIONS. If any provision or any portion of any
provision of this Agreement or the application of such provision or any
portion thereof to any person or circumstance, shall be held invalid or
unenforceable, the remaining portion of such provision and the
remaining provisions of this Agreement, or the application of such
provision or portion of such provision as is held invalid or
unenforceable to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
BCS INVESTMENT CORPORATION
By: /s/Nicholas Miller
------------------------------------
Nicholas Miller, President
AUTOVENU, INC. SHAREHOLDERS:
/s/Mark Moldenhauer
---------------------------------------
Mark Moldenhauer
/s/Jules Wurzel
---------------------------------------
Jules Wurzel
BusinessTradeCenter.com, Inc.
By: /s/Mark R. Jensen
------------------------------------
Mark R. Jensen President
--------------, --------------
Share Exchange Agreement-Page 30
<PAGE>
SCHEDULE A
AutoVenu, Inc. Shareholders:
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------
NO. OF NO. OF SHARES OF NO. OF SHARES OF
AUTOVENU BCS COMMON BCS PREFERRED
NAME SHARES STOCK STOCK
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Mark Moldenhauer 270,000 82,005,507 1,726,107
------------------------------------------------------------------------------------------------------
BusinessTradeCenter.com Inc. 10,000 3,037,241 63,930
------------------------------------------------------------------------------------------------------
Jules Wurzel 3,000 911,172 19,179
------------------------------------------------------------------------------------------------------
TOTAL 283,000 85,953,920 1,809,216
------------------------------------------------------------------------------------------------------
</TABLE>
Share Exchange Agreement-Page 31
<PAGE>
