AGREEMENT AND PLAN OF SHARE EXCHANGE
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THIS AGREEMENT AND PLAN OF SHARE EXCHANGE (the "Agreement) is made as of
this 15th day of June, 2000, by and between ANYTHING INTERNET CORPORATION, a
Colorado corporation ("Buyer") and INFORM WORLDWIDE, INC., a Colorado
corporation ("Company").
WHEREAS, the Board of Directors of each of the Buyer and the Company
believe it is in the best interests of each company and its respective
shareholders that Buyer acquire the Company through an exchange of the shares of
Buyer for the shares of the Company (the "Merger") and, in furtherance thereof
have approved the Merger;
WHEREAS, pursuant to the Merger, among other things, all of the issued and
outstanding shares of the capital stock of the Company shall be exchanged into
the right to receive shares of common stock of Buyer on the basis of one share
of Company into 150 shares of Buyer;
WHEREAS, the parties intend that the transaction be treated as a tax-free
reorganization under Section 368(a)(1)(B) of the Internal Revenue Code of 1986,
as amended;
WHEREAS, the parties desire to make certain representations, warranties,
covenants and other agreements in connection with the Merger;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged by the parties, and of the terms, covenants and conditions
hereinafter contained, the parties hereto agree as follows:
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1. THE SHARE EXCHANGE
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1.1 The Share Exchange . At the Effective Time (defined in
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Section 1.3) and subject to the terms and conditions of this Agreement and the
applicable provisions of Colorado law, the shares of common stock of the Company
will be exchanged into and for shares of the Buyer, and the Company shall
continue as a wholly owned subsidiary of Buyer.
1.2 Closing . Unless this Agreement is earlier terminated, the
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closing of the Merger (the "Closing") shall take place as soon as practically
possible, but no later than two (2) business days following the written consent
of the shareholders of the Company at the office of the Buyer, unless the
parties agree otherwise. The actual date on which the Closing occurs is the
"Closing Date."
1.3 Certificate of Merger . On the Closing Date, the parties
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shall cause the Merger to be consummated by filing an Articles of Share Exchange
(or like instrument) substantially in the form attached as Exhibit A (the
"Merger Agreement") with the Secretary of State of Colorado in accordance with
the Colorado Business Corporation Act. The time of acceptance of the Articles
of Share Exchange by the Colorado Secretary of State shall be referred to as the
"Effective Time."
1.4 Effect of the Merger . At the Effective Time, the effect of
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the Merger shall be as provided in the applicable provisions of Colorado law.
Without limiting the generality of the foregoing, and subject thereto, at the
Effective Time, with respect to the Company stock, the former holders of the
shares of common stock of the Company shall only be entitled to the exchange
rights as provided in the Merger Agreement.
1.5 Effect on Company Capital Stock .
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(a) Effect on Company Capital Stock. At the Effective Time,
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by virtue of the Merger and without any action on the part of the Company or the
shareholders of the Company, each share of capital stock of the Company shall be
exchanged automatically for the right to receive, upon surrender of the stock
certificate, one hundred fifty (150) shares of Buyer and the shares of capital
stock of the Company will be owned and held by the Buyer.
(b) Fractional Shares. Notwithstanding anything to the
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contrary in this Agreement, no fractional shares of Buyer's common stock shall
be issued pursuant to the Merger. In lieu of any fractional shares of Buyer's
common stock pursuant to the Merger, cash adjustments will be paid to holders in
respect of any fractional share of the capital stock of the Company that would
otherwise be issuable in an amount equal to the product of such fractional
amount and the fair market value of a share of capital stock of Buyer.
(c) Surrender of Certificates. At the Effective Time or
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promptly thereafter, the shareholders of the Company will surrender the
certificates representing their Company's capital stock to the Buyer for
cancellation and issuance of certificates for the appropriate number of shares
of common stock of Buyer.
1.6 Tax Consequences . It is intended by the parties that the
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Merger shall constitute a reorganization within the meaning of Section 368 of
the Code. Each party has consulted with its own tax advisors with respect to
the tax consequences of the Merger.
1.7 Board of Directors of Buyer . The Board of Directors of Buyer
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will be increased to make two (2) seats available for Edgar P. Odenwalder III
and Carole A. Baumbusch. Buyer will take appropriate action with respect to its
Articles of Incorporation and By-laws to expand the Board of Directors and
appoint Edgar P. Odenwalder III and Carole A. Baumbusch to the Board of
Directors of Buyer.
1.8 Further Assurances . If, at any time, after the Effective
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Time, any further action is necessary or desirable to consummate the Merger, to
carry out the purposes of this Agreement, the officers, directors of the Company
and Buyer are fully authorized in the name of their respective corporations to
take, and shall take, all such lawful and necessary action.
2. REPRESENTATIONS AND WARRANTIES OF COMPANY. The Company
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represents and warrants to Buyer as follows, each of which representation and
warranty is material and is being relied upon by Buyer and each of which is true
and correct as at the date hereof and shall be true and correct as of the
Effective Time, with the same effect as if each such representation and warranty
had been made at and as of the Effective Time:
2.1 Organization and Good Standing . The Company is a
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corporation duly organized, validly existing and in good standing under the laws
of the State of Colorado and is qualified to conduct business in Colorado and in
all other jurisdictions where the nature of its assets and business requires
such qualifications and the Company has the full corporate power and authority
to own or lease its properties and operate its properties and assets, and to
carry on its business as presently being conducted. True and correct copies of
the incorporation documents and by-laws of the Company, together with all
amendments thereto, have been delivered to Buyer.
2.2 Capital Stock .
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(a) The Company has authorized capital stock consisting of
500,000 shares of common stock, $0.01 par value, of which 20,000 shares are
issued and outstanding, and all of which are duly authorized, validly issued,
fully paid, nonassessable, free of preemptive rights, and were issued in
compliance with all federal and applicable state securities laws.
(b) Except as set forth in Exhibit 2.2 hereof, there are no
outstanding offers, options, warrants, rights, calls, commitments, obligations
(verbal or written), conversion rights, plans or other agreements (conditional
or unconditional) of any character providing for, requiring or permitting the
offer, sale, purchase or issuance of any shares of capital stock of the Company
or any other securities (as such term is defined in the Securities Act of 1933,
as amended). Except as set forth in Exhibit 2.2, there are no equity securities
of the Company that are reserved for issuance or are outstanding.
(c) There are no outstanding or authorized stock
appreciation, phantom stock, profit participation or other similar rights with
respect to the Company. The Company is not a party to and, to the best of
Company's knowledge, there are no voting trusts, proxies or other agreements or
understandings with respect to the voting stock of the Company.
(d) The common stock is owned by the shareholders free and
clear of all liens, charges, encumbrances or claims of any kind whatsoever.
2.3 Subsidiaries, Divisions and Affiliates . Except as set forth
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on Exhibit 2.3, there are no subsidiaries, divisions or affiliates of the
Company. Except as set forth on Exhibit 2.3, the business of the Company has
been conducted solely by the Company and not through any affiliates, joint
venture or other entity, person or under any other name.
2.4 No Outstanding Obligations . There are no contracts, options
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or other agreements or understandings pursuant to which the Company is or may be
obligated to issue shares of its capital, and there are no obligations of the
Company outstanding which may be converted into any shares of capital of such
corporation and, except as disclosed in this Agreement, there are no other
shares of the Company issued or outstanding.
2.5 Equity Investments . Except as set forth in Exhibit 2.5, the
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Company does not own or have any rights to any equity interest, directly or
indirectly, in any corporation, partnership, joint venture, limited liability
company firm or other entity.
2.6 Validity of Agreement . The Company has all requisite power
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and authority to enter into this Agreement and any ancillary agreements to which
it is a party and to consummate the transactions contemplated by this Agreement.
The execution, delivery and performance of this Agreement has been duly and
validly executed and delivered by the Company. This Agreement constitutes a
valid and binding obligation of the Company enforceable in accordance with its
terms, except that such enforcement may be limited by bankruptcy, insolvency or
other similar laws affecting the enforcement of creditors' rights generally.
2.7 Effect of Agreement . The execution, delivery and performance
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of this Agreement by the Company and consummation by the Company of the
transactions contemplated hereby, will not, with or without the giving of notice
and the lapse of time, or both, (a) violate any provision of law, statute, rule,
regulation or executive order to which the Company is subject; (b) violate any
judgment, order, writ or decree of any court applicable to the Company, or (c)
result in the breach of or conflict with any term, covenant, condition or
provision of, result in the modification or termination of, constitute a default
under, or result in the creation or imposition of any lien, security interest,
charge or encumbrance upon any of the assets pursuant to, any corporate charter,
by-law, commitment, contract or other agreement or instrument, including any of
the commitments, to which the Company is a party or by which any of the assets
is or may be bound or affected or from which the Company derives benefit, which
breach, conflict, modification, termination, default or encumbrance described in
this clause (c) would be material to the business of the Company or any of its
assets.
2.8 Restrictions; Burdensome Agreements . Except as set forth on
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Exhibit 2.8, the Company is not a party to any contract, commitment or
agreement, or any of the assets are not subject to, or bound or affected by, any
provision of the articles of incorporation, by-laws, or other corporate
restriction, or any order, judgment, decree, law, statute, ordinance, rule,
regulation or other restriction of any kind or character, which would,
individually or in the aggregate, materially adversely affect the Company's
business or any of the assets.
2.9 Governmental and Other Consents . No consent, authorization
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or approval of, or exemption by, any court, administrative agency or commission,
governmental, public or self-regulatory body or authority ("Governmental
Entity") or any third party is required in connection with the execution,
delivery and performance by the Company of this Agreement or of any of the
instruments or agreements herein referred to, or the taking of any action hereby
contemplated.
2.10 Financial Statements . Except as disclosed in Exhibit 2.10
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or as otherwise disclosed herein, the financial statements for the Company for
the period ended May 31, 2000 (the "Company Financial Statements"), present
fairly the financial position of such company as of the date to which they
relate and have been prepared as internally generated, unaudited financial
statements consistently prepared, and to the best of Company's knowledge, all
items that could have a material adverse effect on the willingness of a
prospective purchaser to acquire the Company have been disclosed in the Company
Financial Statements or in the Exhibits to this Agreement.
2.11 Absence of Certain Changes or Events . Since May 31, 2000,
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except as disclosed on Exhibit 2.11, the Company has not suffered any adverse
changes in, or the occurrence of any events which, individually or in the
aggregate, has or have had, or might reasonably be expected to have, a material
adverse affect on, the Company's financial condition, results of operations,
business, the value of the assets or the shares. Without limiting the
generality of the foregoing, except as set forth on Exhibit 2.11:
(a) The Company has not sold, leased, transferred, or
assigned any of its assets, tangible or intangible, other than for fair
consideration in the ordinary course of business;
(b) The Company has not entered into any agreement, contract,
lease, or license (or series of related agreements, contracts, leases, and
licenses) either involving more than $50,000 or outside the ordinary course of
business consistent with past practice or entered into any transactions not in
the ordinary course of business which would, individually or in the aggregate,
materially adversely affect the assets or the business of the Company;
(c) No party (including the Company) has accelerated,
terminated, modified, or canceled any agreement, contract, lease, or license (or
series of related agreements, contracts, leases, and licenses) to which the
Company is a party or by which it is bound which involves more than $50,000;
(d) The Company has not made any capital expenditure (or
series of related capital expenditures) either involving more than $50,000 or
outside the ordinary course of business consistent with past practice;
(e) The Company has not made any capital investment in, any
loan to, or any acquisition of the securities or assets of, any other person (or
series of related capital investments, loans, and acquisitions) either involving
more than $50,000 or outside the ordinary course of business consistent with
past practice;
(f) The Company has not issued any note, bond, or other debt
security or created, incurred, assumed, or guaranteed any indebtedness for
borrowed money or capitalized lease obligation either involving more than
$50,000 singly or any group of related transactions totaling more than $50,000
in the aggregate;
(g) The Company has not delayed or postponed the payment of
accounts payable or other liabilities outside the ordinary course of business;
(h) The Company has not canceled, compromised, waived, or
released any right or claim (or series of related rights and claims) or other
indebtedness owing to the Company;
(i) Other than distributions necessary to pay Company
shareholder's respective portion of income taxes as approved, or to be approved,
by Buyer, the Company has not declared, set aside, or paid any dividend or made
any distribution with respect to its capital stock (whether in cash or in kind);
(j) The Company has not experienced any damage, destruction,
or loss (whether or not covered by insurance) to any of its assets;
(k) The Company has not made any loan to, or entered into any
other transaction with, any of its directors, officers, and employees;
(l) Except as set forth on Exhibit 2.11(l), the Company has
not granted any increase in the compensation of any of its directors, officers,
and employees or made any other change in employment terms for any of its
directors, officers, and employees;
(m) The Company has not adopted, amended, modified, or
terminated any bonus, profit-sharing, incentive, severance, or other plan,
contract, or commitment for the benefit of any of its directors, officers, and
employees;
(n) The Company has not made or pledged to make any
charitable or other capital contribution outside the ordinary course of
business;
(o) The Company has not sold, assigned, transferred or
granted any rights under or with respect to any Company Intellectual Property
(as defined in Section 2.28(a)) other than in the ordinary course of business,
consistent with past practice;
(p) The Company has not had any labor trouble or claim of
wrongful discharge or other unlawful labor practice;
(q) The Company has not had any lawsuit or proceeding or
investigation commenced or received notice or threat of any lawsuit or
proceeding against the Company;
(r) There has not been any other material adverse occurrence,
event, incident, action, failure to act, or transaction outside the ordinary
course of business involving the Company; and
(s) The Company has not committed to any of the foregoing.
2.12 Undisclosed Liabilities . The Company has no liability,
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and, to the best of the Company's knowledge, there is no basis for any present
or future action, suit, proceeding, hearing, investigation, charge, complaint,
claim, or demand against the Company giving rise to any liability, except for
(a) liabilities set forth on the face of the balance sheet of the Company dated
May 31, 2000, and (b) liabilities which have arisen after the most recent fiscal
month end in the ordinary course of business, none of which results from, arises
out of, relates to, is in the nature of, or was caused by any breach of
contract, breach of warranty, tort, infringement, or violation of law.
2.13 Insurance . There are no outstanding or unsatisfied written
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requirements or repeated verbal recommendations imposed or made by any of the
Company's current insurance companies with respect to current policies covering
any of the assets, or by any governmental authority requiring or recommending,
with respect to any of the assets, that any repairs or other work be done on or
with respect to, or requiring or recommending any equipment or facilities be
installed on or in connection with, any of the assets. The Company carries,
and (with respect to any period for which a claim against the Company may still
arise) has always carried worker's compensation insurance in reasonable amounts,
and other insurance which is reasonably necessary to the conduct of the
Company's business. Exhibit 2.13 sets forth a correct and complete list of (a)
all currently effective insurance policies and fidelity and surety bonds
covering the assets or the business of the Company, and their respective annual
premiums (as of the last renewal or purchase of new insurance), and (b) for the
fiscal-year period ending on the date hereof, (i) all accidents, casualties or
damage occurring on or to the assets or relating to the business or products of
the Company which in the aggregate are in excess of $10,000, and (ii) claims for
damages, contribution or indemnification and settlements (including pending
settlement negotiations) relating thereto which in the aggregate are in excess
of $10,000. Except as set forth on Exhibit 2.13, as of the date hereof there
are no disputes with underwriters of any such policies and bonds, and to the
best knowledge of the Company, there is no condition or circumstance applicable
to the business of the Company, other than the sale of the Company shares
pursuant to this Agreement, which may result in such termination or increase.
The Company and the assets are in compliance with all conditions contained in
such policies or bonds, except for non-compliance which, individually or in the
aggregate, would not have a material adverse affect on the business of the
Company or the assets.
2.14 Compliance with Laws . To the best of Company's knowledge,
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Company materially has complied, and is currently in material compliance, with
all applicable laws, statutes and ordinances, rules, regulations, codes, plans,
injunctions, judgments, orders, decrees, rulings, and charges of federal, state,
local, and foreign governments, and all agencies thereof, and no action, suit,
proceeding, hearing, investigation, charge, complaint, claim, demand, or notice
has been filed or commenced against any of them alleging any failure so to
comply.
2.15 Employees . The Company has delivered to Buyer a list,
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attached as Exhibit 2.15, setting forth the names of all directors, officers and
employees (by classification or type) of the Company and its respective rates of
compensation, including the portions thereof attributable to bonuses, and any
other salary, bonus or other payment arrangement made with or promised to it.
2.16 Employee Benefit Plans . Except as set forth on Exhibit
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2.16, the Company has not at any time maintained, sponsored, adopted, made
contributions to or obligated itself to make contributions to or to pay any
benefits or grant rights under or with respect to (1) any pension, profit
sharing or other plan of deferred compensation; (2) any medical plan, life
insurance plan, short-term or long-term disability plan, severance plan, dental
plan or other employee benefit plan or employee welfare benefit plan within the
meaning of the Employee Retirement Income Security Act of 1974 ("ERISA"); or (3)
any personnel policy, excess benefit, bonus or incentive plan (including stock
options, restricted stock, stock bonus, and deferred bonus plans), salary
reduction agreements, change-of-control agreements, employment agreements or
consulting agreements (collectively "Employee Benefit Plan").
2.17 No Guarantees . The Company is not a guarantor or otherwise
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liable for any liability or obligation (including indebtedness) of any other
person.
2.18 Accounts Receivable . Exhibit 2.18 contains a list of the
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accounts receivable and customer list of the Company as of May 31, 2000.
2.19 Books and Records . The books of account and other
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financial and corporate records of the Company are in all material respects
complete, correct and up to date, with all necessary signatures, and are in all
material respect accurately reflected in the Company Financial Statements.
2.20 Absence of Litigation . Except as set forth on Exhibit
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2.20:
(a) there are no material claims, actions, suits,
proceedings, arbitrations, investigations or hearings pending, or to the best of
the knowledge of the Company, threatened against or affecting the licenses,
business, operations, properties or assets or the condition, financial or
otherwise, of the Company, or in any way involving this Agreement or the
transaction contemplated hereby. To the best knowledge of the Company, it has
not waived any statute of limitations or other affirmative defense with respect
to any of its obligations. There is no continuing order, injunction or decree
of any court, arbitrator or governmental or administrative authority to which
the Company is a party, or to which it is subject. Neither the Company nor any
other current officer, director, partner or employee of the Company or any
affiliate of the Company has been permanently or temporarily enjoined or barred
by order, judgment or decree of any court or other tribunal or any agency or
self-regulatory body from engaging in or continuing any conduct or practice in
connection with the business engaged in by the Company.
(b) there is no order or decree of any court or agency
directed to the Company arising out of any judicial, or quasi-judicial,
proceeding before any such court or agency with respect to the Company being in
default of an order of such court or agency.
2.21 No Interest in Competitors . Set forth on Exhibit 2.21 is a
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list describing the extent to which the Company or any other officer or director
of the Company or any affiliate of any of the foregoing, directly or indirectly,
owns more than a five percent (5%) interest in or controls or is an employee,
officer, director, or partner of or participant in (but only to the extent such
a participation exceeds one percent), or consultant to any corporation,
partnership, limited partnership, limited liability company, joint venture,
association or other entity which is a competitor, supplier or customer of the
Company or has any type of business or professional relationship with the
Company.
2.22 Taxes . Except as reflected in the Company Financial
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Statements or in Exhibit 2.22 or in respect of taxes accruing with respect to
the current fiscal year: (a) the Company has duly filed on a timely basis all
tax returns required to be filed by it, and has paid all assessments and
reassessments, and all other taxes, governmental charges, penalties, interests
and fines due and payable by it on or before the date hereof and which are
claimed by any governmental authority to be due and owing; and (b) there are no
audits, actions, suits, proceedings, investigations or claims threatened or,
examinations pending against the Company with respect to taxes, governmental
charges or assessments or any other matters under discussion with any
governmental authority relating to taxes, governmental charges or assessments
asserted by any such authority.
2.23 Contracts and Agreements . Exhibit 2.23 sets forth all
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material contracts, agreements, licenses and leases of all kind to which the
Company is a party and, except for the items listed on such schedule, the
Company is not a party to any contract, agreement or lease of any kind, and all
such contracts, agreements and leases are valid, effective and in good standing,
and no party thereto is in default or breach thereof. The Company is not a
party to any material contract, agreement, license or lease of any kind, except
as set forth on Exhibit 2.23 hereto.
2.24 No Defaults . Except as set forth on Exhibit 2.24, the
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Company has fulfilled, or has taken all action reasonably necessary to enable it
to fulfill when due, all of its obligations, except where the failure to do so
would not, individually or in the aggregate, have a material adverse effect on
the business of the Company or its assets (tangible or intangible).
Furthermore, there has not occurred any default by the Company or any event
which, with the lapse of time or the election of any person other than the
Company, will become a default, nor to the knowledge of the Company has there
occurred any default by others or any event which, with the lapse of time or the
election of the Company, will become a default, except for such defaults, if
any, which (a) have not resulted and will not result in any material loss to or
liability of the Company or any of its successors or assigns or (b) have been
indicated on Exhibit 2.24. The Company is not in arrears in any material
respect with respect to the performance or satisfaction of the terms and
conditions to be performed or satisfied by it under any of its material
contracts, licenses or leases or other agreements and, to the best of Company's
knowledge and belief, no waiver or variance has been granted by any of the
parties hereto.
2.25 No Consents Required . After the change in ownership of the
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Company, except as set forth on Exhibit 2.25, each of the material contracts,
licenses or leases included in the assets does not require the consent of the
other parties thereto and, with respect to any of the commitments which do
require the consent of the other parties thereto, the Company has obtained or
prior to the Effective Time will obtain such consent and has provided or will
provide Buyer with copies thereof.
2.26 Intellectual Property .
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(a) For the purposes of this Agreement, the following terms
have the following definitions:
(i) "Intellectual Property" shall mean any or all of the
following and all rights in, arising out of, or associated therewith: (A) all
United States and foreign patents and applications therefor and all reissues,
divisions, renewals, extensions, provisionals, continuations and
continuations-in-part thereof; (B) all inventions (whether patentable or not),
invention disclosures, improvements, trade secrets, proprietary information,
know how, technology, technical data and customer lists, and all documentation
relating to any of the foregoing; (C) all copyrights, copyrights registrations
and applications therefor and all other rights corresponding thereto throughout
the world; (D) all mask works, mask work registrations and applications
therefor; (E) all industrial designs and any registrations any applications
therefor throughout the world; (F) all trade names, logos, common law trademarks
and service marks; trademark and service mark registrations and applications
therefor and all goodwill associated therewith throughout the world; (G) all
databases and data collections and all rights therein throughout the world; (H)
all computer software including all source code, object code, firmware,
development tools, files, records and data, all media on which any of the
foregoing is recorded, all Internet and Worldwide Web addresses, URLs, sites and
domain names; (I) any similar, corresponding or equivalent rights to any of the
foregoing; and (J) all documentation related to any of the foregoing.
(ii) "Company Intellectual Property" shall mean any
Intellectual Property that is owned by or exclusively licensed to the Company.
(iii) "Registered Intellectual Property" shall mean all
United States, international and foreign: (A) patents, patent applications
(including provisional applications); (B) registered trademarks, applications to
register trademarks, intent-to-use applications, or other registrations on
applications related to trademarks; (C) copyright registration; (D) any mask
work registrations and applications to register mask works; and (E) any other
Company Intellectual Property that is the subject of an application,
certificate, filing, registration or other document issued by, filed with, or
recorded by, any state, government or other public legal authority.
(b) Exhibit 2.26(b) lists all Registered Intellectual
Property owned by, or filed in the name of, the Company (the "Company Registered
Intellectual Property") and lists any proceedings or actions before any court,
tribunal (including the United States Patent and Trademark Office (the "PTO") or
equivalent authority anywhere in the world) related to any of the Company
Registered Intellectual Property Rights.
(c) Except as set forth in Exhibit 2.26(c), each item of
Company Intellectual Property, including all Company Registered Intellectual
Property listed in Exhibit 2.26(b) and all Intellectual Property licensed to the
Company, is free and clear of any liens, charges or encumbrances. The Company
has rights to the trademarks, trade names and copyrights used in connection with
the operation or conduct of the business of the Company that are sufficient to
enable the Company to conduct its business as the business is currently
conducted, including the sale of any products or technology or the provision of
any services by the Company (other than with respect to products acquired from
third parties). The Company, to its knowledge, owns exclusively, and has good
title to, all copyrighted works that are Company products or other works of
authorship that the Company otherwise purports to own.
(d) To the extent that any Intellectual Property has been
developed or created by any person other than the Company for which the Company
has, directly or indirectly, paid, the Company has a written agreement with such
person with respect thereto and the Company thereby has obtained ownership of,
and is the exclusive owner of, by operation of law or by valid assignment, all
such Intellectual Property.
(e) Except as set forth in Exhibit 2.26(e), the Company has
not transferred ownership of or granted any license of or right to use or
authorized the retention of any rights to use any Intellectual Property that is
or was Company Intellectual Property, to any other person.
(f) The Company Intellectual Property constitutes all the
Intellectual Property used in and/or necessary to the conduct of its business as
it currently is conducted, including, without limitation, the design,
development, manufacture, use, import and sale of the products, technology and
services of the Company (including products, technology or services currently
under development).
(g) Except as listed in Exhibit 2.26(g), to the Company's
knowledge, no person who has licensed Intellectual Property from the Company has
ownership in such Intellectual Property.
(h) To the Company's knowledge, Exhibit 2.26(h) lists all
contracts, licenses and agreement between the Company and any other person
wherein or whereby the Company has agreed to, or assumed, any obligation or duty
to assume or incur any obligation or liability or provide a right of rescission
with respect to the infringement or misappropriation by the Company or such
other person of the Intellectual Property of any person other than the Company.
(i) To the Company's knowledge, the operation of the business
of the Company as it currently is conducted, including but not limited to the
Company's design, development, use, import, manufacture and sale of the
Company's website and the Company's products, technology or services (including
portions of the Company's website or the Company's products, technology or
services currently under development) does not infringe or misappropriate any
Intellectual Property of any person, violate the rights of any person (including
rights to privacy or publicity), or constitute unfair competition or trade
practices under the laws of any jurisdiction. The Company has not received any
notice from any person that the operation of the business of the Company as it
currently is conducted, including but not limited to the Company's design,
development, use, import, manufacture and sale of the products, technology or
services (including products, technology or services currently under
development) of the Company infringes or misappropriates the Intellectual
Property (other than trademarks, trade names and service marks) of any person or
constitutes unfair competition or trade practices under the laws of any
jurisdiction.
(j) All necessary registrations, maintenance and renewal fees
in connection with such Registered Intellectual Property have been paid and all
necessary documents and certificates in connection with such Company Registered
Intellectual Property have been filed with the relevant patent, copyright,
trademark or other authorities in the United States or foreign jurisdictions, as
the case may be, for the purposes of maintaining such Registered Intellectual
Property.
(k) To the Company's knowledge, there are no contracts,
licenses or agreements between the Company and any other person with respect to
Company Intellectual Property under which there is any dispute known to the
Company regarding the scope of such agreement, or performance under such
agreement including with respect to any payments to be made or received by the
Company thereunder.
(l) To the Company's knowledge, as of the date of this
Agreement, no person is infringing or misappropriating any Company Intellectual
Property.
(m) The Company has, and enforces, a policy requiring each
employee, consultant and contractor to execute proprietary information,
confidentiality and assignment agreements substantially in the Company's
standard forms, and except as listed on Exhibit 2.26(m), all current employees,
consultants and contractors of the Company have executed such an agreement;
(n) To the Company's knowledge, as of the date of this
Agreement, no Company Intellectual Property or product, technology or service of
the Company, including its website, is subject, or may reasonably be expected to
become subject to, any proceeding or outstanding decree, order, judgment,
agreement or stipulation that restricts in any manner the use, transfer or
licensing thereof by the Company or many affect the validity, use or
enforceability of such Company Intellectual Property.
(o) To the Company's knowledge, no: (A) product, technology,
service or publication of the Company, including its website, (B) material
published or distributed by the Company, including its website, or (C) conduct
or statement of Company constitutes obscene material, a defamatory statement or
material false advertising.
(p) Except as set forth in Exhibit 2.26(p), all of the
Company's products (including its website and products currently under
development) will record, store, process, calculate and present calendar dates
falling on or after (and if applicable, spans of time including) January 1,
2000, and will calculate any information dependent on or relating to such dates
in the same manner, and with the same functionality, data integrity and
performance, as the products record, store, process, calculate and present
calendar dates on or before December 31, 1999, or calculate any information
dependent on or relating to such dates.
2.27 Permits, Licenses, etc. There are no permits, licenses,
-------------------------
orders or approvals of the Company of governmental or administrative authorities
required to permit the Company to carry on its business as currently conducted
(other than (a) permit, licenses, orders and approvals of the Company which are
set forth on Exhibit 2.27, all of which are in full force and effect, and (b)
other permits, licenses, orders and approvals of the Company, the failure to
obtain which would not, individually or in the aggregate, have a material
adverse effect on the assets or on the Company's business).
2.28 Marketable Title; No Liens . Except as set forth in Exhibit
--------------------------
2.28, or as otherwise disclosed herein, the Company owns and has good and
marketable title to all of the personal property and assets, tangible or
intangible, as reflected on the Company Financial Statements (except for assets
disposed of in the ordinary course of business, consistent with past practice
since the respective dates of the Company Financial Statements), free and clear
of all contracts of sale, liens, mortgages, pledges, security interests,
charges, restrictions, prior assignments, encumbrances and claims of every kind.
2.29 Powers of Attorney . Except as set forth on Exhibit 2.29,
--------------------
no person has any power of attorney to act on behalf of the Company in
connection with any of the Company's properties or business affairs other than
such powers to so act as normally pertain to the officers of the Company.
2.30 Sufficiency of Assets and Commitments . Except as set forth
-------------------------------------
in Exhibit 2.30, the assets of the Company, tangible and intangible, taken in
the aggregate, are sufficient and constitute all of the property and rights
necessary, for the continuation of the business and operations of the Company on
a basis consistent with past operations.
2.31 Labor Disputes, Unfair Labor Practices . Except as set
------------------------------------------
forth on Exhibit 2.31, the Company is not engaged in any labor practice which
would have a material adverse affect on the assets or the Company's business.
There is no pending or affirmatively threatened (a) unfair labor practice
complaint, charge, labor dispute, strike, slowdown, walkout or work stoppage
before the National Labor Relations Board or any other authority or (b)
grievance or arbitration proceeding arising out of or under a collective
bargaining agreement involving employees of the Company. There have been no
strikes, labor disputes, slowdowns, walkouts, or work stoppages involving
employees of the Company during the last three years. No union representation
question exists with respect to the employees of the Company and no union
organizing activities are taking place. The Company has not received notice
from any of its employees of such employee's intent to terminate his or her
employment or bring any action against the Company for any reason related to the
transactions contemplated by this Agreement or for any other reason.
2.32 Past Due Obligations . Except as set forth on Exhibit 2.32,
--------------------
no past due obligations of the Company over $5000 have given rise or shall give
rise within 5 days after the Effective Time (except as such will be performed by
the Company prior to the Effective Time so as to relieve Buyer of all liability
therefor) to any additional liability to Buyer on account of their being past
due.
2.33 Recent Dividends and Other Distributions . There has been
------------------------------------------
no dividend or other distribution of assets or securities whether consisting of
money, property or any other thing of value, declared, issued or paid to or for
the benefit of shareholders subsequent to the date of the most recent Company
Financial Statements by the Company.
2.34 No Untrue Statements . Neither this Agreement nor any
----------------------
documents, certificates or statements furnished to Buyer by or on behalf of the
Company in connection herewith contains any untrue statement of a material fact
or omits to state a material fact (materiality being determined in relation to
the Company taken as a whole) necessary in order to make the statements
contained herein and therein not misleading. There is no fact known to the
Company, which materially adversely affects, or in the future may materially
adversely affect, the business, properties, assets, prospects or financial
condition of the Company which has not been set forth in this Agreement or the
exhibits hereto or otherwise disclosed in writing to Buyer including by means of
the financial statements for the Company.
2.35 Warranties; Indemnities . Except for the warranties and
------------------------
indemnifies contained in those contracts and agreements set forth in Exhibit
2.35, the Company has not issued any warranties or indemnities relating to
products or technology sold or licensed or services rendered by the Company,
other than warranties and indemnities that are not in the aggregate, reasonably
expected to have a material adverse effect.
2.36 Restrictions on Business Activities . Except as set forth
-------------------------------------
on Exhibit 2.36, to the Company's knowledge, there is no agreement (noncompete
or otherwise), commitment, judgment, injunction, order or decree to which the
Company is a party or otherwise binding upon the Company which has or may have
the effect of prohibiting or impairing any business practice of the Company, any
acquisition of property (tangible or intangible) by the Company or the conduct
of business as currently run by the Company. Without limiting the foregoing,
the Company has not entered into any agreement under which the Company is
restricted from selling, licensing or otherwise distributing any of its
technology or products to or providing services to, customers or potential
customers or any class of customers, in any geographical area, during any period
of time or in any segment of the market.
2.37 Environmental Matters .
----------------------
(a) To the Company's knowledge, the Company has not
transported, stored, used, manufactured, disposed of, released or exposed its
employees or others to Hazardous Materials in violation of any law in effect on
or before the Effective Time, nor has the Company disposed of, transported,
sold, or manufactured any product containing a Hazardous Material (any or all of
the foregoing being collectively referred to as "Hazardous Materials
Activities") in violation of any rule, regulation, treaty or statute promulgated
by any governmental entity in effect prior to or as of the date hereof to
prohibit, regulate or control hazardous materials or any Hazardous Material
Activity.
(b) To the Company's knowledge, the Company currently holds
all environmental approvals, permits, licenses, clearances and consents (the
"Environmental Permits") necessary for the conduct of the Company's Hazardous
Material Activities, respectively, and other businesses of the Company as such
activities and businesses are currently being conducted. For purposes of this
Agreement, the term "Hazardous Materials" includes but is not limited to any and
all substances (whether solid, liquid or gas) defined, listed, or otherwise
classified as pollutants, hazardous wastes, hazardous substances, hazardous
materials, extremely hazardous wastes, or words of similar meaning or regulatory
effect under any present Environmental Laws or that may have a negative impact
on human health or the environment, including, without limitation, petroleum and
petroleum products, asbestos and asbestos-containing materials, polychlorinated
biphenyls, lead, materials containing lead-based paint, radon, radioactive
materials, flammables and explosives.
(c) No action, proceeding, revocation proceeding, amendment
procedure, writ, injunction or claim is pending nor has the Company received
notice (oral or written) of any action, proceeding, revocation proceeding,
amendment procedure, writ, injunction or claim threatened concerning any
Environmental Permit, Hazardous Material or any Hazardous Materials Activity of
the Company.
2.38 Brokers' and Finders' Fees; Third Party Expenses . Except as
------------------------------------------------
set forth in Exhibit 2.38 the Company has not incurred, nor will it incur,
directly or indirectly, any liability for brokerage or finders' fees or agents'
commissions or any similar charges in connection with this Agreement or any
transaction contemplated hereby. Exhibit 2.38 sets forth the principal terms
and conditions of any agreement, written or oral, with respect to such fees.
3. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and
---------------------------------------
warrants to the Company that the following are true and correct as of the date
hereof:
3.1 Organization and Good Standing . Buyer is a corporation duly
-------------------------------
organized, validly existing and in good standing under the laws of the State of
Colorado and is validly existing and in good standing under its jurisdiction of
incorporation and is qualified to do business in all jurisdictions where the
nature of its assets and business requires such qualification and has the full
corporate power and authority to own, lease and operate its property and
businesses.
3.2 Capitalization . Buyer has an authorized capitalization of 50
--------------
million shares of common stock and 10 million shares of convertible Class A
preferred. There are presently issued and outstanding 2,454,046 shares of
common stock of Buyer and 1,106,716 shares of convertible Class A preferred
stock of Buyer. No other stock of Buyer is outstanding.
3.3 Corporate Authorization . The execution and performance of
------------------------
this Agreement and the issuance and delivery of the Buyer's shares of common
stock in accordance with the provisions hereof have been duly authorized by all
necessary corporate action on the part of Buyer and this Agreement constitutes a
valid, binding and enforceable obligation upon Buyer except that such
performance may be limited by bankruptcy, insolvency, or other similar laws
affecting the enforcement of creditors' rights generally.
3.4 No Breach or Violation . The execution and performance of
-------------------------
this Agreement and compliance with the provisions hereof by Buyer will not
violate, with or without the giving of notice or the passage of time, any
applicable law or regulation and will not conflict with, or result in the breach
of, any of the terms, conditions or provisions of, or constitute a default
under, any corporate charter, by-law, indenture, mortgage, agreement or other
instrument to which Buyer is bound.
3.5 Continuation of Business . Buyer shall continue the operation
------------------------
and conduct of the business of Company as presently conducted for such period of
time as may be required under Section 368(a)(1)(B) of the Internal Revenue Code
of 1986, as amended.
4. CONDUCT PRIOR TO EFFECTIVE TIME.
-----------------------------------
4.1 Conduct Prior to Effective Time . The Company covenants and
---------------------------------
agrees between the date of this Agreement and the Effective Time or date of
termination of this Agreement, as the case may be, except as permitted or
required by this Agreement or as Buyer may otherwise consent in writing, to:
(a) operate the business of the Company only in the usual,
regular and ordinary manner, consistent with past practice and use its best
efforts to (I) preserve the present business organization of the Company intact,
(II) keep available the services of the present employees of the Company who are
listed on Exhibit 2.15, and (III) preserve the current business relationships of
the Company with customers, suppliers, distributors and others having business
dealings with it;
(b) bear the risk of loss or damage to the assets on and
prior to the Effective Time where such risk of loss is not the legal obligation
of another, and maintain all properties and assets, tangible or intangible,
necessary for the conduct of the business of the Company, whether owned or
leased;
(c) maintain the books, records and accounts of the Company
in the usual, regular and ordinary manner, on a basis consistent with prior
periods;
(d) duly comply with all laws which apply to the Company and
to the conduct of its business;
(e) perform all of the obligations of the Company without
default, unless such default is of no significance to the Company and could have
no adverse impact on the Company, its assets or business;
(f) not (I) amend the Company's Articles of Incorporation or
by-laws; (II) merge with or into, consolidate, amalgamate or otherwise combine
with, any other entity, or agree to do any of the foregoing; or (III) change the
character of the business of the Company;
(g) not (I) encumber, mortgage, or voluntarily subject to
lien any of the existing assets; (II) transfer, sell, lease, license or
otherwise dispose of any of, or any part of, the assets except in the ordinary
course of business, and consistent with past practice; (III) convey, transfer or
acquire any assets or property to, for or on behalf of the Company, other than
in the ordinary course of business, consistent with past practice; (IV) enter
into any arrangement, agreement or undertaking, with respect to any of the
Company's employees relating to the payment of any bonus, severance,
profit-sharing or special compensation or any increase in the compensation
payable or to become payable to any such employee; or (V) incur any material
fixed or contingent obligation or enter into any agreement, commitment, contract
or other transaction or arrangement relating to the business of the Company or
its assets;
(h) except in the ordinary course of business and consistent
with past practice, (I) sell or enter into any license agreement with respect to
Company Intellectual Property with any person or entity or (II) buy or enter
into any license agreement with respect to Intellectual Property of any person
or entity;
(i) except in the ordinary course of business and consistent
with past practice, transfer to any person or entity any rights to Company
Intellectual Property;
(j) commence any litigation or settle (I) any litigation for
$50,000 or more or (II) any litigation relating to Intellectual Property rights;
provided that the Company shall have the right to settle litigation outstanding
as of the date hereof, so long as the terms of such settlement involve no
monetary obligation or other liability imposed on the Company;
(k) not make any distributions or dividends of assets or
securities, nor any changes to the capital structure of the Company;
(l) not modify, change or terminate any of its material
obligations other than in the ordinary course of business, or grant any power of
attorney with respect to the business of the Company or the assets to any party
except Buyer; and
(m) except for payment of the Company's current obligations,
not to incur any additional obligations and liabilities, including (I) all
liabilities for all claims incurred, whether or not reported, on or before the
Effective Time under all "employee welfare benefit plans," within the meaning of
ERISA, (II) all liabilities or obligations for vacations or sick leave or
retiree, medical or life benefits to employees or former employees of the
Company, and (III) all liabilities of the Company for all benefits accrued under
any "employee pension benefit plan," within the meaning of ERISA under each
Employee Benefit Plan.
4.2 Access to Properties, Records, Suppliers, Agents, etc.
------------------------------------------------------------
Company shall give to Buyer and to Buyer's counsel, financiers, accountants and
other representatives access to and copies of such of the Company's properties,
personnel, books, tax returns, contracts, commitments and records as relate to
the assets, suppliers, agents, or other aspects of the business of the Company,
and shall furnish to Buyer and such representatives all such additional
instruments, contracts, documents or other written obligations (certified by
officers of the Company, if so requested) and financial and other information
concerning such business, assets, suppliers, agents, and other aspects of the
business of the Company as Buyer or its representatives may from time to time
request.
4.3 Advice of Changes . If the Company becomes aware of any fact
-----------------
or facts which, if known at the date hereof, would have been required to be set
forth or disclosed in or pursuant to this Agreement or which, individually or in
the aggregate, could materially adversely affect the business, assets or common
stock of the Company, Company shall promptly advise Buyer in writing thereof.
4.4 Conduct . Except as permitted or required hereby or as Buyer
-------
may otherwise consent in writing, the Company shall not enter into any
transaction or take any action which would result in any of the representations
and warranties of the Company contained in this Agreement or in any other
document not being true and correct as of the time immediately after such
transaction has been entered into or such event has occurred, and on the
Effective Time.
4.5 Satisfaction of Conditions by Company . The Company hereby
----------------------------------------
covenants and agrees with Buyer, that, between the date of this Agreement and
the Effective Time or date of termination of this Agreement, as the case may be,
the Company shall use its best efforts to assure that the conditions set forth
in Section 6 hereof are satisfied by the Effective Time.
4.6 Non-Disclosure of Negotiations and Non-Usage of Documents of
--------------------------------------------------------------
Buyer . The Company hereby covenants and agrees with Buyer that, except as may
----
be required by law, the Company shall not publicly use, show, display, describe
or otherwise disclose, directly or indirectly, in any manner, this Agreement,
any Exhibits hereto or any other document created by Buyer's counsel, in whole
or in part, which was the subject of negotiations between Buyer and the Company,
or any of the terms or other aspects of the negotiations between Buyer and the
Company, in the event that the closing shall not occur for any reason. The
Company further agrees that it will return and instruct all of its advisors,
representatives and other parties to return to Buyer all documents or other
written material regarding this transaction that were obtained from Buyer or its
counsel during the course of the negotiations (including all drafts of all
documents).
Prior to the closing, Company will use its best efforts to keep
confidential any and all information furnished to it by Buyer in the course of
the negotiations. If for any reason the closing shall not occur, the Company
will continue to use its best efforts to keep such information confidential, to
the extent that it is protectable by law.
5. PRE-CLOSING COVENANTS OF BUYER.
---------------------------------
5.1 Satisfaction of Conditions by Buyer . Buyer hereby covenants
------------------------------------
and agrees with the Company, that, between the date of this Agreement and the
Effective Time or date of termination of this Agreement, as the case may be,
Buyer shall use its best efforts to assure that the conditions set forth in
Section 7 hereof are satisfied by the Effective Time.
5.2 Confidentiality . Prior to the Closing, Buyer will use its
---------------
best efforts to keep confidential any and all information furnished to it by the
Company in the course of negotiations. If for any reason the closing shall not
occur, Buyer will continue to use its best efforts to keep such information
confidential, to the extent that it is protectable by law, and will not use it
and will return to the Company all documents or other written material regarding
this transaction that were obtained during the course of negotiations (including
all drafts of all documents).
Prior to the closing, Buyer will use its best efforts to keep confidential
any and all information furnished to it by Company in the course of the
negotiations. If for any reason the closing shall not occur, the Buyer will
continue to use its best efforts to keep such information confidential, to the
extent that it is protectable by law.
6. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER.
------------------------------------------------------
The obligations of Buyer pursuant to this Agreement are subject to the
satisfaction at the closing of each of the following conditions, any or all of
which conditions may be waived by Buyer in its sole discretion:
6.1 Accuracy of Representations and Warranties . All
----------------------------------------------
representations and warranties made by the Company (contained in this Agreement,
any Exhibit hereto, or any certificate or instrument delivered to Buyer or its
representatives) shall be true on and as of the Effective Time with the same
force and effect as though made on and as of the Effective Time (i.e., with
----
respect to a representation that a state of facts exists on or as of the date
hereof, it is a condition that such state of acts exists on or as of the
Effective Time; and with respect to a representation that a state of facts has
or has not changed between a date prior to the date hereof and the date hereof,
it is a condition that such state of facts has or has not changed between such
prior date and the Effective Time), except as affected by the transactions
contemplated by this Agreement.
6.2 Performance of Agreements . The Company shall have performed
--------------------------
and complied with all covenants, obligations and agreements to be performed or
complied with by them on or before the Effective Time pursuant to this
Agreement.
6.3 Litigation, etc.
-----------------
(a) Except as set forth on Exhibit 2.20, no claim, action,
suit, proceeding, arbitration, investigation or hearing or notice of hearing
shall be pending or threatened against or affecting the Company or any of the
assets, which (i) might result either in an action to enjoin or prevent the
consummation of the transactions contemplated by this Agreement; or (ii) would
materially adversely affect the business of the Company or the ability of Buyer
to consummate the transactions contemplated by this Agreement or to own the
assets or to operate the business of the Company.
(b) The Company shall not be in violation of any law,
statute, ordinance, regulation or executive order, the enforcement of which
would, individually or in the aggregate, materially adversely affect the assets
or the business of the Company; or which would, individually or in the
aggregate, materially adversely affect the ability of Buyer to consummate the
transactions contemplated by this Agreement or to own the assets or to operate
the business of the Company.
(c) No law, regulation or decree shall have been proposed,
adopted or promulgated, or have become effective, the enforcement of which would
materially adversely affect the ability of Buyer to consummate the transactions
contemplated by this Agreement or to own the assets or to operate any such
business.
6.4 Approves and Consents . The Company shall have obtained, and
---------------------
Buyer shall have received copies of all of the approvals and consents referred
to in Section 2.25, each of which approvals and consents shall be in full force
and effect and reasonably satisfactory in form and substance to Buyer and its
counsel.
6.5 Company's Certificate . Buyer shall have received an
----------------------
accurate certificate of the Company dated the Effective Time, satisfactory in
form and substance to Buyer and its counsel, certifying (a) as to the
fulfillment of the matters specified in Sections 6.1 through 6.3, and (b) any
changes that Buyer is required to be notified of pursuant to Section 4.3, or
that previously had not been disclosed to Buyer.
6.6 Officer's Certificate . Buyer shall have received a
----------------------
certificate, dated the Effective Time, of the President of the Company, dated as
of the Closing date, stating, among other things, that he is not aware of any
material omissions or facts that would materially alter any of the Company
Financial Statements, nor is he aware of any facts or factors that are
reasonably likely to occur, or if known to other parties, that could have a
material adverse affect on the financial condition, business, operations,
assets, liabilities, management or prospects of the Company.
6.7 Good Standing Certificates . Buyer shall have received (a) a
---------------------------
certificate of the Office of the Secretary of State of Colorado, dated within 30
days before the Effective Time, certifying that the records of such state
regarding the Company in such state reflect neither a certificate of
dissolution, a court order declaring dissolution, a merger or consolidation
which terminated its existence, nor suspension of its corporate powers, rights
and privileges, and that in accordance with the records of such state, such
corporation is authorized to exercise all of its corporate powers, rights and
privileges in such state.
6.8 Material Adverse Change . There have been no material adverse
-----------------------
changes in the financial condition, business, operations, assets, liabilities,
management or prospects of the Company.
6.9 Actions, Proceedings, etc. All actions, proceedings,
----------------------------
instruments and documents required to carry out the transactions contemplated by
this Agreement shall have been reasonably satisfactory to Buyer, such approval
not to be unreasonably withheld.
6.10 Opinion of Counsel to The Company . Buyer shall have
--------------------------------------
received an opinion of counsel to the Company, addressed to Buyer, dated the
Effective Time, in form and substance satisfactory to Buyer and its counsel.
6.11 Licenses, Permits, Consents, etc. Buyer shall have received
---------------------------------
evidence, in form and substance reasonably satisfactory to counsel for Buyer,
that such licenses, permits, consents, authorizations or orders of governmental
authorities as are necessary to the consummation of the transactions
contemplated by this Agreement and the continued operation of the business of
the Company have been obtained.
6.12 Documentation of Company Intellectual Property . The Company
----------------------------------------------
shall have delivered to Buyer true and complete copies of all of the
documentation held by the Company relating to each of the Company's Intellectual
Property.
6.13 Officers' Financial Certificate . Buyer shall have received
--------------------------------
a certificate as set forth in Exhibit 6.13 from the Company dated as of the
Effective Time, satisfactory in form and substance to Buyer and its counsel,
certifying that the Company Financial Statements are true and correct, and
accurately present the financial position of the Company during that interim
period.
6.14 Update of Exhibits . The Company shall have furnished to
--------------------
Buyer as Exhibit 6.14, immediately prior to the Effective Time, an amendment to
the Exhibits to this Agreement which shall update as of the Effective Time all
information specifically required to be contained in the Exhibits as of the date
hereof which have come into existence between the date hereof and the Effective
Time, and the information supplied in the amendment to the Exhibits shall not
show the incorrectness or untruthfulness or lack of completeness in any respect
of any representation or warranty made by the Company as of the date hereof or
as of the Effective Time, or the breach of any agreement, covenant or condition
required by this Agreement to be performed or complied with by the Company prior
to the Effective Time.
6.15 Completion of Due Diligence and Approval of Exhibits . Buyer
----------------------------------------------------
shall have received sufficient information and access to such information on a
timely basis regarding the Company and shall have approved all Exhibits to this
Agreement.
6.16 Employment and Consulting Agreements . An employment
---------------------------------------
agreement and a consulting agreement with Edgar P. Odenwalder III and Carole A.
Baumbusch, respectively, in the form attached as Exhibit 6.16 shall have been
entered into by such persons.
7. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE COMPANY.
-------------------------------------------------------------
The obligations of the Company under this Agreement are subject to the
satisfaction at the closing of each of the following conditions, any or all of
which conditions may be waived by the Company in its sole discretion:
7.1 Accuracy of Representations and Warranties . All
----------------------------------------------
representations and warranties made by Buyer in this Agreement shall be true as
of the Effective Time with the same force and effect as though made on and as of
the Effective Time.
7.2 Performance of Agreements . Buyer shall have performed and
---------------------------
complied in all material respects with all covenants, obligations and agreements
to be performed or complied with by it on or before the Effective Time pursuant
to this Agreement.
7.3 Employment and Consulting Agreements . An employment
---------------------------------------
agreement and a consulting agreement with Edgar P. Odenwalder III and Carole A.
Baumbusch, respectively, in the form attached as Exhibit 6.16 shall have been
entered into by such persons.
8. MISCELLANEOUS.
-------------
8.1 Nature and Survival of Representations, Warranties, Covenants
--------------------------------------------------------------
and Indemnification . All statements contained in this Agreement or in any
--------------------
Exhibit or document delivered in connection with this Agreement shall be deemed
----
representations and warranties by such party hereunder. All representations,
warranties, covenants and indemnities made in this Agreement or pursuant hereto
shall survive the closing hereunder until one year from the date of closing
except (a) with respect to any claim, written notice of which shall have been
delivered to Buyer or the Company, as the case may be, prior to a date one year
from the date of Closing, such claim shall survive the termination of such
period and shall survive for as long as such claims is unsettled, and (b) with
respect to any litigation which shall have been commenced to resolve such claim
on or prior to such date.
8.2 Entire Agreement; Amendment . This Agreement and the
-----------------------------
documents referred to herein constitute the entire Agreement among the parties
hereto with respect to the subject matter hereof and supersedes all prior
written or oral warranties, representations, inducements, understandings,
commitments, agreements or contracts. No amendment to or modification of the
terms or conditions hereof shall be binding unless it is in writing and signed
by the party against whom the amendment or modification is charged. No party
hereto shall be bound by or charged with any written or oral arguments,
representations, warranties, statements, promises or understandings not
specifically set forth in this Agreement or in any Exhibit hereto or in
certificates and instruments to be delivered pursuant hereto on or before the
closing.
8.3 Notices . All notices or other communications required or
-------
permitted hereunder shall be in writing and shall be deemed given, delivered and
received (a) when delivered, if delivered personally, (b) three days after
mailing, when sent by registered or certified mail, return receipt requested and
postage prepaid, (c) the next business day after delivery to a reputable private
courier service, when delivered to a private courier service providing
documented overnight service, and (d) on the date of delivery if delivered by
telecopy, receipt confirmed, provided that a confirmation copy is sent on the
next business day by registered or certified mail, return receipt requested and
postage prepaid, in each case addressed as follows:
If to Buyer:
Anything Internet Corporation
820 16th Street
Suite 732
Denver, Colorado 80202
Attention: Donald W. Prosser
720/904-1396 - fax
with a copy to:
Gerald L. Fishman
Charles J. Mack
Wolin & Rosen, Ltd.
55 West Monroe Street
Suite 3600
Chicago, Illinois 60603
312/424-0660 - fax
If to the Company:
Inform WorldWide, Inc.
10333 East Dry Creek Road
Suite 270
Englewood, Colorado
Attention: Edgar Odenwalder, III
303/662-0700 - fax
with a copy to:
Stanton Rosenbaum
Isaacson, Rosenbaum, Woods & Levy, P.C.
633 17th Street
Suite 2200
Denver, CO 80202
303/292-3152 - fax
or to such other address as the recipient party may indicate by a notice
delivered to the sending party (such change of address notice to be deemed
given, delivered and received only upon actual receipt thereof by the recipient
of such notice).
8.4 Severability . Whenever possible, each paragraph of this
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Agreement shall be interpreted in such manner as to be effective and valid under
applicable law. If any paragraph of this Agreement shall be unenforceable or
invalid under applicable law, such paragraph shall be ineffective only to the
extent and duration of such unenforceability or invalidity and the remaining
substance of such paragraph and the remaining paragraphs of this Agreement shall
in such event continue to be binding and in full force and effect.
8.5 Waivers . No failure by any party to exercise any of such
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party's rights hereunder or to insist upon strict compliance with respect to any
obligation hereunder, and no custom or practice of the parties at variance with
the terms hereof, shall constitute a waiver by any party to demand exact
compliance with the terms hereof. Waiver by any party of any particular default
by any other party shall not affect or impair such party's rights in respect of
any subsequent default of the same or of a different nature, nor shall any delay
or omission of any party to exercise any rights arising from any default by any
other party affect or impair such party's rights as to such default or any
subsequent default. No action taken pursuant to this Agreement, including any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representation,
warranty, covenant or agreement contained herein or in any other documents. Any
party hereto may, at or before the Closing, waive any conditions to its
obligations hereunder which are not fulfilled.
8.6 Headings; Certain Terms . The section and other headings
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contained in this Agreement are for reference purposes only and shall not be
deemed to be a part of this Agreement or to affect the meaning or interpretation
of this Agreement. As used in this Agreement, the term "including" means
"including, but not limited to" unless otherwise specified; the word "or" means
"and/or," and the word "person" means and refers to any individual, corporation,
trust, partnership, limited liability company, joint venture, government or
governmental authority, or any other entity.
8.7 Counterparts . This Agreement may be executed in any number
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of counterparts, each of which, when executed, shall be deemed to be an original
and all of which together shall be deemed to be one and the same instrument.
8.8 Expenses . Except as and to the extent otherwise provided in
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this Agreement, whether or not the transactions contemplated by this Agreement
are consummated, the Buyer shall pay any and all expenses and the fees and
expenses of Company's and other experts of Company.
8.9 Termination of Agreement . This Agreement may be terminated
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and the transactions contemplated hereby may be abandoned at any time, but not
later than the Effective Time:
(a) by mutual consent of the parties; or
(b) by either party, if a condition precedent to such party's
obligations, as recited in Section 6 or 7, has not been satisfied or waived.
In the event of the termination of this Agreement by any party as above
provided, without material fault of any party, no party shall have any liability
hereunder, including any liability for damages. In the event that a condition
precedent to a party's obligation is not met, nothing contained herein shall be
deemed to require any party to terminate this Agreement rather than to waive
such condition precedent and proceed with the closing.
8.10 Binding Effect; Benefits . This Agreement shall inure to the
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benefit of the parties hereto and shall be binding upon the parties hereto and
their respective successors and permitted assigns. This Agreement may not be
assigned by Company or Buyer without the prior express written consent of the
other party. Except as otherwise set forth herein, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective successors and permitted assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement.
8.11 Disclosures . Any disclosure by either party hereto pursuant
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to any specific provision of this Agreement shall be deemed a disclosure for all
other purposes of this Agreement.
8.12 Section References . All references contained in this
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Agreement to any section number are references to sections of this Agreement
unless otherwise specifically stated.
8.13 Brokers and Finders . Neither Buyer nor the Company has
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employed any broker, agent or finder or incurred any liability for any brokerage
fees, agents' commissions, finders' fees or advisory fees in connection with the
transactions contemplated by this Agreement; and the Company on the one hand,
and Buyer on the other hand, shall indemnify and hold each other harmless in
respect of any such obligation or liability based in any way on agreements or
arrangements or understandings claimed to have been made by any thereof with any
third party.
8.14 Public Announcements . No press release or other public
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statement with respect to this Agreement or the transactions contemplated hereby
shall be issued by any party without that party having consulted with and
obtained the written consent of the other parties hereto; provided, however,
notwithstanding the foregoing, Buyer, as a company subject to the U.S.
securities laws and regulations relating to publicly-held companies, may make
such public statements at such time and in such form as may be required under
such laws or regulations as advised by its counsel.
8.15 No Strict Construction . The language used in this Agreement
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will be deemed to be the language chosen by the parties to express their mutual
intent, and no rule of strict construction will be applied against any person.
8.16 Number and Gender . Each defined term used in this Agreement
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has a comparable meaning when used in its plural or singular form. Each
gender-specific term used herein will have a comparable meaning whether used in
a masculine, feminine or gender-neutral form.
8.17 No Solicitation .
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(a) For purposes of this Section 8.17, the following terms
shall have the following meanings:
(i) "Acquisition Proposal" shall mean any offer or
proposal (other than an offer or proposal by Buyer) contemplating or otherwise
relating to any Company Acquisition Transaction.
(ii) A party's "Associates" shall include such party's
subsidiaries and other affiliates and the respective directors, officers,
employees, agents, representatives, consultants, accountants, attorneys and
financial advisors of such party and its affiliates.
(iii) "Company Acquisition Transaction" shall mean any
transaction not contemplated by this Agreement involving; (A) any sale, lease,
exchange, transfer or other disposition of the assets of the Company or any
subsidiary of the Company constituting more than 5% of the assets of the Company
or accounting for more than 5% of the revenues of the Company in any one
transaction or in an series of related transactions; or (B) any offer to
purchase, tender offer, exchange offer or any similar transaction or series of
related transactions made by any person, group or entity involving more than 5%
of the outstanding shares of capital stock of the Company; or (C) any merger,
consolidation, business combination, share exchange, reorganization or similar
transaction or series of related transactions involving the Company other than
any transaction which results in the stockholders of the Company before the
transaction continuing to hold at least 95% of the outstanding voting securities
of the Company after such transaction.
(iv) "Termination Date" shall mean the earlier of (A)
the Effective Time, or (B) the date that this Agreement is terminated in
accordance with its terms.
(b) The Company agrees that prior to and through the Termination
Date, it shall not, directly or indirectly, and shall not authorize or permit
any Associate of the Company to (i) solicit, initiate, encourage or induce the
making, submission or announcement of any Acquisition Proposal or take any
action that could reasonably be expected to lead to an Acquisition Proposal,
(ii) furnish any information regarding the Company or any subsidiary of the
Company to any person, group or entity in connection with or in respect to any
Acquisition Proposal, (iii) continue or engage in discussions with any person,
group or entity with respect to any Acquisition Proposal, (iv) approve, endorse
or recommend any Acquisition Proposal or (v) enter into any letter of intent,
term sheet or similar document or any contract, commitment or other obligation
of any kind contemplating or otherwise relating to any Company Acquisition
Transaction (other than with Buyer and Merger Subsidiary). Without limiting the
generality of the foregoing, the Company acknowledges and agrees that any
violation of any of the restrictions set forth in the preceding sentence by an
Associate of the Company shall be deemed to constitute a breach of this Section
(b). In addition, the Company agrees that any negotiations with respect to any
of the above activities (other than negotiations with Buyer and Merger
Subsidiary) in progress as of the date hereof will be suspended during the
period from the date hereof through the Termination Date. In the event that the
Company receives, directly or indirectly, any Acquisition Proposal, the Company
shall immediately notify Buyer thereof, including information as to the identity
of the offeror or the party making any such Acquisition Proposal and the
specific terms of such Acquisition Proposal. The Company agrees that its
obligations under this Section (b) are necessary and reasonable in order to
protect Buyer and its business, and expressly agrees that monetary damages would
be inadequate to compensate Buyer for any breach of this Section (b).
Accordingly, the Company agrees and acknowledges that any such violation or
threatened violation will cause irreparable injury to Buyer and that, in
addition to any other remedies that may be available in law, in equity or
otherwise, Buyer shall be entitled to obtain injunctive relief against the
threatened breach of this Agreement or the continuation of any such breach,
without the necessity of proving damages.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
ANYTHING INTERNET CORPORATION
By:_____________________________________
Name: Larry G. Arnold
Title: Chief Executive Officer
INFORM WORLDWIDE, INC.
By:_____________________________________
Name: Edgar P. Odenwalder III
Title: President
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