EXHIBIT 2.1
STOCK ACQUISITION AND REORGANIZATION AGREEMENT
THIS STOCK ACQUISITION AND REORGANIZATION AGREEMENT ("Agreement") is made
and entered into in duplicate effective the 19th day of December 2000
("Effective Date"), by and among MYG Corp., a Nevada corporation ("MYG");
Bisassist, Inc., a Texas corporation ("Bisassist"); and those persons specified
more particularly on that schedule attached to this Agreement marked as Exhibit
A, the provisions of which, by this reference, are made a part of this Agreement
as though specified completely and specifically at length in this Agreement. For
convenience, the persons specified in Exhibit A of this Agreement shall be
referred to in this Agreement, collectively, as the "Shareholders" and any of
them may be referred to in this Agreement, individually, as a "Shareholder".
RECITALS
A. Shareholders own 9,980,000 shares of the $.001 par value common stock of
Bisassist, representing all of the issued and outstanding stock of Bisassist
("Shares").
B. Shareholders desire to exchange all of the Shares for 9,980,000 shares
of the $.001 par value common stock of MYG ("MYG Common Stock"), on the terms
and subject to the conditions specified by the provisions of this Agreement.
C. The Boards of Directors of Bisassist and MYG have determined that it is
advisable and appropriate and in the best interests of the those corporations
and their respective shareholders that the exchange contemplated by the
provisions of Recital B specified above occur, on the terms and subject to the
conditions specified by the provisions of this Agreement.
D. The parties to this Agreement desire that the transaction contemplated
by the provisions of this Agreement satisfy the requirements of Section
368(a)(1)(B) of the Internal Revenue Code of 1986, as amended, and the
regulations promulgated pursuant thereto.
NOW, THEREFORE, IN CONSIDERATION OF THE RECITALS SPECIFIED ABOVE THAT SHALL BE
DEEMED TO BE A SUBSTANTIVE PART OF THIS AGREEMENT, AND THE MUTUAL COVENANTS,
PROMISES, UNDERTAKINGS, AGREEMENTS, REPRESENTATIONS AND WARRANTIES SPECIFIED IN
THIS AGREEMENT AND OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND
SUFFICIENCY OF WHICH ARE HEREBY ACKNOWLEDGED, WITH THE INTENT TO BE OBLIGATED
LEGALLY AND EQUITABLY, THE PARTIES DO HEREBY COVENANT, PROMISE, AGREE, REPRESENT
AND WARRANT AS FOLLOWS:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms have the meanings
specified or referred to in this Article I:
<PAGE>
"Applicable Contract" -- any Contract (a) pursuant to which Bisassist has
or may acquire any rights, (b) pursuant to which Bisassist has or may become
subject to any obligation or liability, or (c) by which Bisassist or any of the
assets owned or used by Bisassist is or may become obligated.
"Best Efforts" -- the efforts that a prudent Person (defined below)
desiring to achieve a result would use in similar circumstances to ensure that
such result is achieved as expeditiously as possible.
"Bisassist"-- Bisassist Inc., a Texas corporation, as defined in the
preamble of this Agreement.
"Bisassist Disclosure Letter" -- the disclosure letter delivered by
Shareholders to MYG concurrently with the execution and delivery of this
Agreement.
"Breach" -- a "Breach" of a representation, warranty, covenant, obligation,
or other provision of this Agreement or any instrument delivered pursuant to
this Agreement will be deemed to have occurred if there is or has been (a) any
inaccuracy in or breach of, or any failure to perform or comply with, such
representation, warranty, covenant, obligation, or other provision, or (b) any
claim (by any Person) or other occurrence or circumstance that is or was
inconsistent with such representation, warranty, covenant, obligation, or other
provision, and the term "Breach" means any such inaccuracy, breach, failure,
claim, occurrence, or circumstance.
"Consent" -- any approval, consent, ratification, waiver, or other
authorization (including any Governmental Authorization (defined below)).
"Contemplated Transactions" -- all of the transactions contemplated by this
Agreement, including; but not limited to:
(a) the transfer of the Shares by Shareholders to MYG in exchange for
9,980,000 shares of $.001 par value common stock of MYG;
(b) the performance by MYG and the Shareholders of their respective
covenants and obligations pursuant to this Agreement;
(c) MYG's acquisition and ownership of the Shares and assumption of control
of Bisassist;
(d) the appointment of Calvin Mees as a director of MYG;
(e) the appointment of Romie Krickbaum as a director of MYG;
(f) the appointment of Tarja Morado as a director of MYG; and
(g) the resignation of Bruce Younker as an officer and director of MYG.
2
<PAGE>
"Contract" -- any agreement, contract, obligation, promise, or undertaking
(whether written or oral and whether express or implied) that is legally
obligating.
"Effective Date" -- the date upon which this Agreement is signed and
delivered by the parties hereto, as defined in the preamble of this Agreement.
"Employee Benefit Plan" -- any "Employee Pension Benefit Plan" (as defined
in Section 3(2) of ERISA), "Employee Welfare Benefit Plan" (as defined in
Section 3(1) of ERISA), "Multi-employer Plan" (as defined in Section 3(37) of
ERISA), plan of deferred compensation, medical plan, life insurance plan,
long-term disability plan, dental plan or other plan providing for the welfare
of any of employees or former employees of Bisassist or beneficiaries thereof
(as applicable), personnel policy (including, but not limited to, vacation time,
holiday pay, bonus programs, moving expense reimbursement programs and sick
leave), excess benefit plan, bonus or incentive plan (including, but not limited
to, stock options, restricted stock, stock bonus and deferred bonus plans),
salary reduction agreement, change-of-control agreement, employment agreement,
consulting agreement or any other benefit, program, agreement or contract.
"Encumbrance" -- any charge, claim, community property interest, condition,
equitable interest, lien, option, pledge, security interest, right of first
refusal, or restriction of any nature whatsoever, including any restriction on
use, voting, transfer, receipt of income, or exercise of any other attribute of
ownership.
"Environment" -- soil, land surface or subsurface strata, surface waters
(including navigable waters, ocean waters, streams, ponds, drainage basins, and
wetlands), groundwaters, drinking water supply, stream sediments, ambient air
(including indoor air), plant and animal life, and any other environmental
medium or natural resource.
"Environmental, Health, and Safety Liabilities" -- any cost, damages,
expense, liability, obligation, or other responsibility arising from or pursuant
to applicable Environmental Law (defined below) or Occupational Safety and
Health Law (defined below) and consisting of or relating to:
(a) any environmental, health, or safety matters or conditions (including
on-site or off-site contamination, occupational safety and health, and
regulation of chemical substances or products);
(b) fines, penalties, judgments, awards, settlements, legal or
administrative proceedings, damages, losses, claims, demands and response,
investigative, remedial, or inspection costs and expenses arising pursuant to
Environmental Law or Occupational Safety and Health Law, including consultant
and attorney fees;
(c) financial responsibility pursuant to Environmental Law or Occupational
Safety and Health Law for cleanup costs or corrective action, including any
investigation, cleanup, removal, containment, or other remediation or response
actions ("Cleanup") required by applicable Environmental Law or Occupational
Safety and Health Law (whether or not such Cleanup has been
3
<PAGE>
required or requested by any Governmental Body (defined below) or any other
Person) and for any natural resource damages; or
(d) any other compliance, corrective, investigative, or remedial measures
required pursuant to Environmental Law or Occupational Safety and Health Law.
The terms "removal," "remedial," and "response action," include the types
of activities specified by the United States Comprehensive Environmental
Response, Compensation, and Liability Act, 42 U.S.C. Sections 9601 et seq., as
amended ("CERCLA").
"Environmental Law" -- any Legal Requirement (defined below) that requires
or relates to:
(a) advising appropriate authorities, employees, and the public of intended
or actual releases of Hazardous Materials (defined below), violations of
discharge limits, or other prohibitions and of the commencements of activities,
such as resource extraction or construction, that could have significant impact
on the Environment;
(b) preventing or reducing to acceptable amounts the release of Hazardous
Materials into the Environment;
(c) reducing the quantities, preventing the release, or minimizing the
hazardous characteristics of wastes that are generated;
(d) assuring that products are designed, formulated, packaged, and used so
that these products do not present unreasonable risks to human health or the
Environment when used or disposed of;
(e) protecting resources, species, or ecological amenities;
(f) reducing to acceptable amounts the risks inherent in the transportation
of Hazardous Materials;
(g) cleaning up Hazardous Materials that have been released, preventing the
threat of release, or paying the costs of such clean up or prevention; or
(h) making responsible parties pay private parties, or groups of them, for
damages done to their health or the Environment, or permitting self-appointed
representatives of the public interest to recover for injuries done to public
assets.
"ERISA" -- the Employee Retirement Income Security Act of 1974, or any
successor law, and regulations and rules issued pursuant to that Act or any
successor law.
4
<PAGE>
"Facilities" -- any real property, leaseholds, or other interests currently
or formerly owned or operated by Bisassist and any buildings, plants,
structures, or equipment (including motor vehicles, aircraft, and rolling stock)
currently or formerly owned or operated by Bisassist.
"GAAP" -- generally accepted United States accounting principles, applied
on a basis consistent with the basis on which the Bisassist Balance Sheet
(defined in Section 3.5 of this Agreement) and the other financial statements
referred to in Section 3.4 were prepared.
"Governmental Authorization" -- any approval, consent, license, permit,
waiver, or other authorization issued, granted, given, or otherwise made
available by or pursuant to the authority of any Governmental Body or pursuant
to any Legal Requirement.
"Governmental Body" -- any:
(a) nation, state, commonwealth, county, city, town, village, district,
ward, or other jurisdiction of any nature;
(b) federal, state, local, municipal, foreign, or other government;
(c) governmental or quasi-governmental authority of any nature whatsoever
(including any governmental agency, branch, department, official, or entity and
any court or other tribunal);
(d) multi-national organization or body; or
(e) body exercising, or entitled to exercise, any administrative,
executive, judicial, legislative, police, regulatory, or taxing authority or
power of any nature whatsoever.
"Hazardous Activity" -- the distribution, generation, handling, importing,
management, manufacturing, processing, production, refinement, Release (defined
below), storage, transfer, transportation, treatment, disposal or use (including
any withdrawal or other use of groundwater) of Hazardous Materials in, on,
under, about, or from the Facilities or any part thereof into the Environment,
and any other act, omission, business, operation, or thing that increases the
danger, or risk of danger, or poses an unreasonable risk of harm to persons or
property on or off the Facilities, or that may affect the value of the
Facilities or Bisassist.
"Hazardous Materials" -- any waste or other substance that is regulated,
listed, defined, designated, or classified as, or otherwise determined to be,
hazardous, radioactive, or toxic or a pollutant or a contaminant pursuant to any
Environmental Law, including any mixture or solution thereof, and specifically
including petroleum and all derivatives thereof or synthetic substitutes
therefor, polychlorinated biphenyls ("PCBs") and asbestos or asbestos-containing
materials.
"IRC" -- the Internal Revenue Code of 1986, or any successor law, and
regulations issued by the IRS pursuant to the Internal Revenue Code or any
successor law.
5
<PAGE>
"IRS" -- the United States Internal Revenue Service, or any successor
agency, and, to the extent relevant, the United States Department of the
Treasury.
"Knowledge" -- an individual will be deemed to have "Knowledge" of a
particular fact or other matter if such individual should have been aware of
such fact or other matter, after reasonable investigation thereof.
A Person (other than an individual) will be deemed to have "Knowledge" of a
particular fact or other matter if any individual who is serving, or who has at
any time served, as a director, officer, partner, manager, executor, or trustee
of such Person (or in any similar capacity) has, or at any time had, Knowledge
of such fact or other matter.
"Legal Requirement" -- any federal, state, local, municipal, foreign,
international, multinational, or other administrative order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.
"MYG"-- MYG Corp., a Nevada corporation, as defined in the preamble of this
Agreement.
"MYG Common Stock" -- the $.001 par value common stock of MYG, for which
the Shareholders will transfer all the issued and outstanding stock of
Bisassist.
"Occupational Safety and Health Law" -- any Legal Requirement designed to
provide safe and healthful working conditions and to reduce occupational safety
and health hazards, and any program, whether governmental or private (including
those promulgated or sponsored by industry associations and insurance
companies), designed to provide safe and healthful working conditions.
"Order" -- any award, decision, injunction, judgment, order, ruling,
subpoena, or verdict entered, issued, made, or rendered by any court,
administrative agency, or other Governmental Body or by any arbitrator.
"Ordinary Course of Business" -- an action taken by a Person will be deemed
to have been taken in the "Ordinary Course of Business" only if:
(a) such action is consistent with the past practices of such Person and is
taken in the ordinary course of the normal day-to-day operations of such Person;
(b) such action is not required to be authorized by the Board of Directors
of such Person (or by any Person or group of Persons having similar authority);
and
(c) such action is similar in nature and magnitude to actions customarily
taken, without any authorization by the Board of Directors of such Person (or by
any Person or group of Persons exercising
6
<PAGE>
similar authority), in the ordinary course of the normal day-to-day operations
of other Persons that are in the same business as such Person.
"Organizational Documents" -- (a) the articles or certificate of
incorporation and the bylaws of a corporation; (b) the partnership agreement and
any statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) the articles of organization and the operating agreement of a
limited liability company; (e) any charter or similar document adopted or filed
in connection with the creation, formation, or organization of a Person; and (f)
any amendment to any of the foregoing.
"Person" -- any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company,
fraternal organization, group, joint venture, estate, trust, association,
organization, labor union, or other entity or Governmental Body.
"Plan Affiliate" -- with respect to any Person, any other person or entity
with whom the Person constitutes all or part of a controlled group, or which
would be treated with the Person as under common control or whose employees
would be treated as employed by the Person, pursuant to Section 414 of the IRC
and any regulations, administrative rulings and case law interpreting the
foregoing.
"Proceeding" -- any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative, investigative, or
informal) commenced, brought, conducted, or heard by or before, or otherwise
involving, any Governmental Body or arbitrator.
"Related Person"
(a) with respect to a particular individual:
(i) each other member of such individual's Family (defined below);
(ii) any Person that is directly or indirectly controlled by such
individual or one or more members of such individual's Family;
(iii) any Person in which such individual or members of such
individual's Family hold (individually or in the aggregate) a Material
Interest (defined below); and
(iv) any Person with respect to which such individual or one or more
members of such individual's Family serves as a director, officer, partner,
executor, or trustee (or in a similar capacity).
(b) With respect to a specified Person other than an individual:
(i) any Person that directly or indirectly controls, is directly or
indirectly controlled by, or is directly or indirectly under common control
with such specified Person;
7
<PAGE>
(ii) any Person that holds a Material Interest in such specified
Person;
(iii) each Person that serves as a director, officer, partner,
executor, or trustee of such specified Person (or in a similar capacity);
(iv) any Person in which such specified Person holds a Material
Interest;
(v) any Person with respect to which such specified Person serves as a
general partner, manager or a trustee (or in a similar capacity); and
(vi) any Related Person of any individual described in clause (ii) or
(iii) of this Subsection (b).
For purposes of this definition, (a) the "Family" of an individual includes
(i) the individual, (ii) the individual's spouse, (iii) any other natural person
who is related to the individual or the individual's spouse within the second
degree, and (iv) any other natural person who resides with such individual, and
(b) "Material Interest" means direct or indirect beneficial ownership (as
defined in Rule 13d-3 pursuant to the Securities Exchange Act of 1934) of voting
securities or other voting interests representing at least 10% of the
outstanding voting power of a Person or equity securities or other equity
interests representing at least 10% of the outstanding equity securities or
equity interests in a Person.
"Release" -- any spilling, leaking, emitting, discharging, depositing,
escaping, leaching, dumping, or other release into the Environment, whether
intentional or unintentional.
"Reorganization" -- The exchange of MYG Common Stock for all of the Shares,
pursuant to Section 368(a)(1)(B) of the Code.
"Representative" -- with respect to a particular Person, any director,
officer, manager, employee, agent, consultant, advisor, or other representative
of such Person, including legal counsel, accountants, and financial advisors.
"Securities Act" -- the Securities Act of 1933, or any successor law, and
regulations and rules issued pursuant to that Act or any successor law.
"Shareholders" -- the persons specified in Exhibit A of this Agreement.
"Shares" -- as defined in the Recital A of this Agreement.
"Subsidiary" -- with respect to any Person (the "Owner"), any corporation
or other Person of which securities or other interests having the power to elect
a majority of that corporation's or other Person's Board of Directors or similar
governing body, or otherwise having the power to direct the business and
policies of that corporation or other Person (other than securities or other
interests having
8
<PAGE>
such power only upon the happening of a contingency that has not occurred) are
held by the Owner or one or more of its Subsidiaries.
"Tax" -- Any tax, charge, fee, levy, interest, penalty, addition to tax or
other assessment, including, but not limited to, income, provincial, excise,
property "real, tangible personal or intangible personal", sales, use, gross
receipts, business and occupation, value added and franchise tax, license,
recording, documentation and registration fee and customs duty, imposed by any
Governmental Body and any payment with respect thereto required pursuant to any
tax sharing agreement.
"Tax Return" -- any return (including any information return), report,
statement, schedule, notice, form, or other document or information filed with
or submitted to, or required to be filed with or submitted to, any Governmental
Body in connection with the determination, assessment, collection, or payment of
any Tax or in connection with the administration, implementation, or enforcement
of or compliance with any Legal Requirement relating to any Tax.
"Threat of Release" -- a substantial probability of a Release that may
require action in order to prevent or mitigate damage to the Environment that
may result from such Release.
"Threatened" -- a claim, Proceeding, dispute, action, or other matter will
be deemed to have been "Threatened" if any demand or statement has been made
(orally or in writing) or any notice has been given (orally or in writing), or
if any other event has occurred or any other circumstances exist, that would
cause a prudent Person to conclude that such a claim, Proceeding, dispute,
action, or other matter probably will be asserted, commenced, taken, or
otherwise pursued in the future.
ARTICLE II
REORGANIZATION AND REGISTRATION
2.1 Qualifying "B" Reorganization. Pursuant to the requirements of Section
368(a)(1)(B) of the IRC and the regulations promulgated pursuant thereto, MYG
will issue and deliver to Shareholders 9,980,000 shares of MYG Common Stock in
exchange for the Shares. Immediately following such exchange, MYG shall have
control (as defined in Section 368(c) of the IRC) of Bisassist.
2.2 Implementation of Reorganization. Shareholders shall cause Bisassist to
(i) take all corporate actions and obtain all approvals and consents necessary
to complete the Reorganization; (ii) secure the consent of any Person (if such
consent is necessary) to the consummation of such Reorganization; (iii) file any
and all necessary documents, returns, notices and applications with all
Governmental Bodies necessary or appropriate to complete the Reorganization;
(iv) deliver the Bisassist Disclosure Letter; and (v) deliver and transfer the
certificates representing and evidencing the Shares, together with stock powers
duly endorsed in blank with signatures guaranteed by Bisassist's transfer agent.
9
<PAGE>
2.3 Obligations upon Execution. Upon the execution of this Agreement:
(a) Shareholders will deliver to MYG:
(i) certificates representing the Shares, duly endorsed (or
accompanied by duly executed stock powers), for transfer to MYG; and
(ii) the Bisassist Disclosure Letter;
(b) MYG will deliver to Shareholders:
(i) one or more certificates evidencing and representing 9,980,000
shares of MYG Common Stock; and
(c) MYG will deliver to Bisassist:
(i) a director's resolution appointing Calvin Mees, Tarja Morado and
Romie Krickbaum as members of MYG's Board of Directors; and
(ii) a letter of resignation executed by Bruce Younker whereby Bruce
Younker resigns as an officer and a director of MYG.
2.4 Shareholders Representative. The Shareholders hereby irrevocably,
unconditionally and forever designate and appoint Calvin Mees, 1353 Middleton
Drive, Cedar Hill, Texas 75104, as their agent and attorney in fact (the
"Shareholders' Representative") with full and complete power and authority to
execute, deliver, and receive on their behalf all notices, requests, and other
communications pursuant to this Agreement; to waive, amend, or modify any
provisions of this Agreement, and to take such other action on their behalf in
connection with this Agreement and the Contemplated Transactions as such agent
deems appropriate; provided, however, that no such waiver, amendment, or
modification may be made if it would decrease the number of shares of MYG Common
Stock to be issued to the Shareholders pursuant to this Agreement or increase
the extent of their obligation.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF SHAREHOLDERS AND BISASSIST
Bisassist and the Shareholders jointly and severally represent and warrant
to MYG as follows:
10
<PAGE>
3.1 Organization and Good Standing.
(a) Part 3.1 of the Bisassist Disclosure Letter contains a complete and
accurate list for Bisassist, of its name, its jurisdiction of incorporation,
other jurisdictions in which it is authorized to do business, and its
capitalization (including the identity of each stockholder and the number of
shares held by each). Bisassist is a corporation duly organized, validly
existing, and in good standing pursuant to the laws of its jurisdiction of
incorporation, with full and complete corporate power and authority to conduct
its business as it is now being conducted, to own or use the properties and
assets that it purports to own or use, and to perform all its obligations
pursuant to Applicable Contracts. Bisassist is duly qualified to do business as
a foreign corporation and is in good standing pursuant to the laws of each state
or other jurisdiction in which either the ownership or use of the properties
owned or used by it, or the nature of the activities conducted by it, requires
such qualification.
(b) Bisassist has delivered to MYG true and correct copies of the
Organizational Documents of Bisassist, as currently in effect.
3.2 Authority; No Conflict.
(a) This Agreement constitutes the legal, valid, and binding obligation of
Shareholders, enforceable against Shareholders in accordance with its terms.
Shareholders have the absolute and unrestricted right, power, authority, and
capacity to execute and deliver this Agreement and to perform their obligations
pursuant to this Agreement, and Shareholders and Bisassist have the absolute and
unrestricted right, power, authority, and capacity to execute and deliver this
Agreement.
(b) Except as set forth in Part 3.2 of the Bisassist Disclosure Letter,
neither the execution and delivery of this Agreement nor the consummation or
performance of any of the Contemplated Transactions will, directly or indirectly
(with or without notice or lapse of time):
(i) contravene, conflict with, or result in a violation of (A) any
provision of the Organizational Documents of Bisassist, or (B) any
resolution adopted by the Board of Directors or the stockholders of
Bisassist;
(ii) contravene, conflict with, or result in a violation of, or give
any Governmental Body or other Person the right to challenge any of the
Contemplated Transactions or to exercise any remedy or obtain any relief
under, any Legal Requirement or any Order to which Bisassist or any
Shareholder, or any of the assets owned or used by Bisassist, may be
subject;
(iii) contravene, conflict with, or result in a violation of any of
the terms or requirements of, or give any Governmental Body the right to
revoke, withdraw, suspend, cancel, terminate, or modify, any Governmental
Authorization that is held by Bisassist or that otherwise relates to the
business of, or any of the assets owned or used by Bisassist;
(iv) cause MYG or Bisassist to become subject to, or to become liable
for the payment of, any Tax;
11
<PAGE>
(v) cause any of the assets owned by Bisassist to be reassessed or
revalued by any taxing authority or other Governmental Body;
(vi) contravene, conflict with, or result in a violation or breach of
any provision of, or give any Person the right to declare a default or
exercise any remedy under, or to accelerate the maturity or performance of,
or to cancel, terminate, or modify, any Applicable Contract; or
(vii) result in the imposition or creation of any Encumbrance upon or
with respect to any of the assets owned or used by Bisassist.
Except as set forth in Part 3.2 of the Bisassist Disclosure Letter,
neither Bisassist nor any Shareholder is or will be required to give any notice
to or obtain any Consent from any Person in connection with the execution and
delivery of this Agreement or the consummation or performance of any of the
Contemplated Transactions.
(c) Shareholders are acquiring the MYG Common Stock for their own accounts
and not with an intention of distribution within the meaning of Section 2(11) of
the Securities Act. Each of the Shareholders, each a shareholder of Bisassist
who is signing this Agreement, severally and not jointly, represents and
confirms to MYG that he or she (i) is an accredited investor within the meaning
of Rule 501(a) pursuant to the Securities Act or, if not such an accredited
investor, has, alone or together with a purchaser representative within the
meaning of Rule 501(h) pursuant to the Securities Act, such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of an investment in MYG's securities; (ii) is aware of the
limits on resale of the MYG Common Stock imposed because of the nature of the
Contemplated Transactions (Rule 144); and (iii) is receiving the MYG Common
Stock without registration pursuant to the Securities Act, in reliance on the
exemption from registration specified in Section 4(2) of the Securities Act for
investment, and without any intent to sell, resell, or otherwise distribute the
MYG Common Stock in any manner that is in violation of the Securities Act. The
certificate representing the MYG Common Stock, when delivered to the
Shareholders, may have appropriate orders restricting transfer placed against
them on the records of the transfer agent for such securities, and may have
placed upon them the following legend:
THE SECURITIES REPRESENTED HEREBY HAVE BEEN ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION PURSUANT TO THE SECURITIES ACT OF 1933. THOSE SECURITIES MAY
NOT BE TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF, UNLESS THE
TRANSFEROR FIRST SATISFIES THE ISSUER AND ITS COUNSEL THAT THE PROPOSED
TRANSFER, IN THE MANNER PROPOSED, DOES NOT VIOLATE THE REGISTRATION REQUIREMENTS
OF THAT ACT.
Each Shareholder agrees not to attempt any transfer of any of the MYG
Common Stock without first complying with the substance of that legend and
agrees that the satisfaction of MYG may, if MYG so requests, depend in part upon
an opinion of counsel acceptable in form and substance to MYG, a no-action
letter of the United States Securities and Exchange Commission, or equivalent
evidence. Each of the Shareholders acknowledges, without limitation, that the
foregoing agreement and representation shall apply to the MYG Common Stock
issued to such Shareholders.
12
<PAGE>
3.3 Capitalization. The authorized equity securities of Bisassist consist
of 100,000,000 shares of $.001 par value common stock and 50,000,000 shares of
$.001 par value preferred stock, of which 9,980,000 shares of common stock are
issued and outstanding, all of which issued and outstanding shares constitute
the "Shares." The Shareholders are the record and beneficial owners and holders
of the Shares, free and clear of all Encumbrances. Part 3.3 of the Bisassist
Disclosure Letter sets forth the ownership of the Shares. No legend or other
reference to any purported Encumbrance appears upon any certificate representing
the Shares. All of the Shares have been duly authorized and validly issued and
are fully paid and nonassessable. Except for this Agreement, there are no
Contracts relating to the issuance, sale, or transfer of any equity securities
or other securities of Bisassist. None of the Shares were issued in violation of
the Securities Act or any other Legal Requirement. Bisassist does not own, or
has any Contract to acquire, any equity securities or other securities of any
Person or any direct or indirect equity or ownership interest in any other
business.
3.4 Options, Warrants and Other Rights and Agreements Affecting Bisassist's
Capital Stock. Bisassist has no authorized or outstanding options, warrants,
calls, subscriptions, rights, convertible securities or other securities, as
defined by the provisions of the Securities Act, or any commitments, agreements,
arrangements or understandings of any manner or nature whatsoever obligating
Bisassist, in any such case, to issue shares of Bisassist's capital stock or
other securities or securities convertible into or evidencing the right to
purchase shares of Bisassist's capital stock or other securities. Neither
Bisassist nor any officer, director, or shareholder of Bisassist is a party to
any agreement, understanding, arrangement or commitment, or obligated by any
provision which creates any rights in any person with respect to the
authorization, issuance, voting, sale or transfer of any shares of Bisassist's
capital stock or other securities.
3.5 Financial Statements. Bisassist has delivered to MYG audited balance
sheets of Bisassist as at November 30 in each of the years 1999 through 2000,
inclusive, and the related audited statement of income for each of the fiscal
years then ended (collectively, "Bisassist Balance Sheet"). Such financial
statements and notes fairly present the financial condition and the results of
operations, changes in stockholders' equity, and cash flow of Bisassist as at
the respective dates of and for the periods referred to in such financial
statements, all in accordance with GAAP, subject, in the case of interim
financial statements, to normal recurring year-end adjustments (the effect of
which will not, individually or in the aggregate, be materially adverse) and the
absence of notes; the financial statements referred to in this Section 3.5
present the consistent application of such accounting principles throughout the
periods involved. No financial statements of any Person other than Bisassist are
required by GAAP to be included in the financial statements of Bisassist.
3.6 Books and Records. The books of account, minute books, stock record
books, and other records of Bisassist, all of which have been delivered to MYG,
are complete and correct and have been maintained in accordance with competent
business practices, including the maintenance of an adequate system of internal
controls. The minute book of Bisassist contains accurate and complete records of
all meetings held of, and corporate actions taken by, the stockholders, the
Boards of Directors, and committees of the Boards of Directors of Bisassist, and
no meeting of any such stockholders, Board of Directors, or committee has been
held for which minutes have not been prepared and are not contained in such
minute books. Upon the execution of this Agreement, all of those books and
records will be in the possession of Bisassist.
13
<PAGE>
3.7 Title to Properties; Encumbrances. Bisassist owns no real property or
any interest therein. Part 3.7 of the Bisassist Disclosure Letter contains a
complete and accurate list of all leaseholds of Bisassist. Bisassist owns all
the properties and assets (whether real, personal, or mixed and whether tangible
or intangible) that Bisassist purports to own, including all of the properties
and assets specified in the Bisassist Balance Sheet (except for assets held
pursuant to capitalized leases disclosed or not required to be disclosed in Part
3.7 of the Bisassist Disclosure Letter and personal property sold since the date
of the Bisassist Balance Sheet, as the case may be, in the Ordinary Course of
Business), and all of the properties and assets purchased or otherwise acquired
by Bisassist since the date of the Bisassist Balance Sheet (except for personal
property acquired and sold since the date of the Bisassist Balance Sheet in the
Ordinary Course of Business and consistent with past practice). All material
properties and assets specified in the Bisassist Balance Sheet are free and
clear of all Encumbrances. Neither the whole nor any portion of any property
held by Bisassist is subject to any governmental decree or Order to be sold or
is being condemned, expropriated or otherwise taken by any Governmental Body or
any Person with or without payment compensation therefor, nor, if any such
condemnation, expropriation or taking being proposed.
3.8 Condition and Sufficiency of Assets. The buildings, plants, structures,
and equipment of Bisassist are structurally sound, are in good operating
condition and repair, and are adequate for the uses to which they are being put,
and none of such buildings, plants, structures, or equipment is in need of
maintenance or repairs except for ordinary, routine maintenance and repairs that
are not material in nature or cost. The buildings, plants, structures, and
equipment of Bisassist are sufficient for the continued conduct of Bisassist's
business after the Effective Date in substantially the same manner as conducted
prior to the Effective Date.
3.9 Accounts Receivable. All accounts receivable of Bisassist that are
specified on the Bisassist Balance Sheet or on the accounting records of
Bisassist as of the Effective Date (collectively, the "Bisassist Accounts
Receivable") represent or will represent valid obligations arising from sales
actually made or services actually performed in the Ordinary Course of Business.
The Bisassist Accounts Receivable are current and collectible net of the
respective reserves shown on the Bisassist Balance Sheet or on the accounting
records of Bisassist as of the Effective Date (which reserves are adequate and
calculated consistent with past practice and, in the case of the reserve as of
the Effective Date, will not represent a greater percentage of the Bisassist
Accounts Receivable as of the Effective Date than the reserve specified in the
Bisassist Balance Sheet represented by the Bisassist Accounts Receivable
specified therein and will not represent a material adverse change in the
composition of such Bisassist Accounts Receivable in terms of aging). Subject to
such reserves, each of the Bisassist Accounts Receivable either has been or will
be collected in full, without any set-off, within 90 days after the day on which
it first becomes due and payable. There is no contest, claim, or right of
set-off, other than returns in the Ordinary Course of Business, pursuant to any
Contract with any obligor of an Bisassist Accounts Receivable relating to the
amount or validity of such Bisassist Accounts Receivable. Part 3.9 of the
Bisassist Disclosure Letter specifies a complete and accurate list of all
Bisassist Accounts Receivable as of the date of the Bisassist Balance Sheet and
the aging of each Bisassist Accounts Receivable.
14
<PAGE>
3.10 Inventory. All inventory of Bisassist, whether or not specified in the
Bisassist Balance Sheet, consists of a quality and quantity usable and salable
in the Ordinary Course of Business, except for obsolete items and items of
below-standard quality, all of which have been written off or written down to
net realizable value in the Bisassist Balance Sheet or on the accounting records
of Bisassist as of the Effective Date, as the case may be. All inventories not
written off have been priced at the lower of cost or market on a first in, first
out basis. The quantities of each item of inventory (whether raw materials,
work-in-process, or finished goods) are not excessive, but are reasonable in the
present circumstances of Bisassist.
3.11 No Undisclosed Liabilities. Except as set forth in Part 3.11 of the
Bisassist Disclosure Letter, Bisassist has no liabilities or obligations of any
nature (whether known or unknown and whether absolute, accrued, contingent, or
otherwise) except for liabilities or obligations specified or reserved against
in the Bisassist Balance Sheet and current liabilities incurred in the Ordinary
Course of Business since the respective dates thereof.
3.12 Taxes.
(a) Bisassist has filed or caused to be filed on a timely basis all Tax
Returns that are or were required to be filed by or with respect to any of them,
either separately or as a member of a group of corporations, pursuant to
applicable Legal Requirements. Bisassist has delivered to MYG copies of all such
Tax Returns filed since January 1, 1997. Bisassist has paid, or made provision
for the payment of, all Taxes that have or may have become due pursuant to those
Tax Returns or otherwise, or pursuant to any assessment received by Shareholders
or Bisassist, except such Taxes, if any, as are listed in Part 3.12 of the
Bisassist Disclosure Letter and are being contested in good faith and as to
which adequate reserves (determined in accordance with GAAP) have been provided
in the Bisassist Balance Sheet.
(b) Part 3.12 of the Bisassist Disclosure Letter contains a complete and
accurate list of all audits of all such Tax Returns, including a reasonably
detailed description of the nature and outcome of each audit. All deficiencies
proposed as a result of such audits have been paid, reserved against, settled,
or, as described in Part 3.12 of the Bisassist Disclosure Letter, are being
contested in good faith by appropriate proceedings. Part 3.12 of the Bisassist
Disclosure Letter describes all adjustments to the United States federal income
Tax Returns filed by Bisassist for all taxable years since 1997, and the
resulting deficiencies proposed by the IRS. Except as described in Part 3.12 of
the Bisassist Disclosure Letter, neither Bisassist or any Shareholder has given
or been requested to give waivers or extensions (or is or would be subject to a
waiver or extension given by any other Person) of any statute of limitations
relating to the payment of Taxes of Bisassist or for which Bisassist may be
liable.
(c) The charges, accruals and reserves with respect to Taxes on the books
of Bisassist are adequate (determined in accordance with GAAP) and are at least
equal to Bisassist's liability for Taxes. There exists no proposed tax
assessment against Bisassist, except as disclosed in the Bisassist Balance Sheet
or in Part 3.12 of the Bisassist Disclosure Letter. No consent to the
application of Section 341(f)(2) of the IRC has been filed with respect to any
property or assets held, acquired, or to be acquired by Bisassist. All Taxes
that Bisassist is or was required by Legal Requirements to withhold or collect
have been duly withheld or collected and, to the extent required, have been paid
to the proper Governmental Body or other Person.
15
<PAGE>
(d) All Tax Returns filed by (or that include on a consolidated basis)
Bisassist are true, correct, and complete. There is no tax sharing agreement
that will require any payment by Bisassist after the date of this Agreement.
Bisassist is not, nor during the 5 year period preceding the Effective Date has
been, an "S" corporation. During the consistency period (as defined in Section
338(h)(4) of the IRC with respect to the sale of the Shares to MYG), neither
Bisassist nor target affiliate (as defined in Section 338(h)(6) of the IRC with
respect to the sale of the Shares to MYG) has sold or will sell any property or
assets to MYG or to any member of the affiliated group (as defined in Section
338(h)(5) of the IRC) that includes MYG. Part 3.12 of the Bisassist Disclosure
Letter lists all such target affiliates.
3.13 No Material Adverse Change. Since the date of the Bisassist Balance
Sheet, there has not been any material adverse change in the business,
operations, properties, prospects, assets, or condition of Bisassist, and no
event has occurred or circumstance exists that may result in such a material
adverse change.
3.14 Employee Benefits. Except as set forth in Part 3.14 of the Bisassist
Disclosure Letter, neither Bisassist nor any Plan Affiliate of Bisassist has
maintained, sponsored, adopted, made contributions to or obligated itself to
make contributions to or to pay any benefits or grant rights pursuant to or with
respect to any Employee Benefit Plan, whether or not written, which could give
rise to or result in Bisassist or such Plan Affiliate having any material debt,
liability, claim or obligation of any kind or nature whatsoever, whether
accrued, absolute, contingent, direct, indirect, known or unknown, perfected or
inchoate or otherwise and whether or not due or to become due. Correct and
complete copies of all Employee Benefit Plans previously have been furnished to
MYG. The Employee Benefit Plans are in compliance in all material respects with
governing documents and agreements and with applicable laws. There has not been
any act or omission by Bisassist pursuant to ERISA or the terms of the Employee
Benefit Plans, or any other applicable law or agreement which could give rise to
any liability of Bisassist, whether pursuant to ERISA, the IRC or other laws or
agreements.
3.15 Compliance with Legal Requirements; Governmental Authorizations.
(a) Except as set forth in Part 3.15 of the Bisassist Disclosure Letter:
(i) Bisassist is and has been in full compliance with each Legal
Requirement that is or was applicable to it or to the conduct or operation
of its business or the ownership or use of any of its assets;
(ii) no event has occurred or circumstance exists that (with or
without notice or lapse of time) (A) may constitute or result in a
violation by Bisassist of, or a failure on the part of Bisassist to comply
with, any Legal Requirement, or (B) may result in any obligation on the
part of Bisassist to undertake, or to pay all or any portion of the cost
of, any remedial action of any nature, including pursuant to any
Environmental, Health, and Safety Liability; and
(iii) Bisassist has not received any notice or other communication
(whether oral or written) from any Governmental Body or any other Person
regarding (A) any actual, alleged,
16
<PAGE>
possible, or potential violation of, or failure to comply with, any Legal
Requirement, or (B) any actual, alleged, possible, or potential obligation
on the part of Bisassist to undertake, or to pay all or any portion of the
cost of, any remedial action of any nature, including pursuant to any
Environmental, Health, and Safety Liability.
(b) Part 3.15 of the Bisassist Disclosure Letter contains a complete and
accurate list of each Governmental Authorization that is held by Bisassist or
that otherwise relates to the business of, or to any of the assets owned or used
by, Bisassist. Each Governmental Authorization listed or required to be listed
in Part 3.15 of the Bisassist Disclosure Letter is valid and in full force and
effect. Except as set forth in Part 3.15 of the Bisassist Disclosure Letter:
(i) Bisassist is and has been in full compliance with all of the terms
and requirements of each Governmental Authorization identified or required
to be identified in Part 3.15 of the Bisassist Disclosure Letter;
(ii) no event has occurred or circumstance exists that may (with or
without notice or lapse of time) (A) constitute or result directly or
indirectly in a violation of or a failure to comply with any term or
requirement of any Governmental Authorization listed or required to be
listed in Part 3.15 of the Bisassist Disclosure Letter, or (B) result
directly or indirectly in the revocation, withdrawal, suspension,
cancellation, or termination of, or any modification to, any Governmental
Authorization listed or required to be listed in Part 3.15 of the Bisassist
Disclosure Letter;
(iii) Bisassist has not received any notice or other communication
(whether oral or written) from any Governmental Body or any other Person
regarding (A) any actual, alleged, possible, or potential violation of or
failure to comply with any term or requirement of any Governmental
Authorization, or (B) any actual, proposed, possible, or potential
revocation, withdrawal, suspension, cancellation, termination of, or
modification to any Governmental Authorization; and
(iv) all applications required to have been filed for the renewal of
the Governmental Authorizations listed or required to be listed in Part
3.15 of the Bisassist Disclosure Letter have been duly filed on a timely
basis with the appropriate Governmental Bodies, and all other filings
required to have been made with respect to such Governmental Authorizations
have been duly made on a timely basis with the appropriate Governmental
Bodies.
The Governmental Authorizations listed in Part 3.15 of the Bisassist Disclosure
Letter collectively constitute all of the Governmental Authorizations necessary
to permit Bisassist to conduct and operate its business lawfully in the manner
Bisassist currently conducts and operates such business and to permit Bisassist
to own and use its assets in the manner in which Bisassist currently owns and
uses such assets.
17
<PAGE>
3.16 Legal Proceedings; Orders.
(a) Except as set forth in Part 3.16 of the Bisassist Disclosure Letter,
there is no pending Proceeding:
(i) that has been commenced by or against Bisassist or that otherwise
relates to or may affect the business of, or any of the assets owned or
used by, Bisassist; or
(ii) that challenges, or that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with, any of the
Contemplated Transactions.
To the Knowledge of Shareholders and Bisassist, (1) no such Proceeding has been
Threatened, and (2) no event has occurred or circumstance exists that may result
in or serve as a basis for the commencement of any such Proceeding. Bisassist
has delivered to MYG copies of all pleadings, correspondence, and other
documents relating to each Proceeding listed in Part 3.16 of the Bisassist
Disclosure Letter. The Proceedings listed in Part 3.16 of the Bisassist
Disclosure Letter will not have a material adverse effect on the business,
operations, assets, condition, or prospects of Bisassist.
(b) Except as set forth in Part 3.16 of the Bisassist Disclosure Letter:
(i) there is no Order to which Bisassist, or any of the assets owned
or used by Bisassist, is subject;
(ii) no Bisassist Shareholder is subject to any Order that relates to
the business of, or any of the assets owned or used by, Bisassist; and
(iii) no officer, director, agent, or employee of Bisassist is subject
to any Order that prohibits such officer, director, agent, or employee from
engaging in or continuing any conduct, activity, or practice relating to
the business of Bisassist.
(c) Except as set forth in Part 3.16 of the Bisassist Disclosure Letter:
(i) Bisassist is and has been in full compliance with all of the terms
and requirements of each Order to which it, or any of the assets owned or
used by it, is or has been subject;
(ii) no event has occurred or circumstance exists that may constitute
or result in (with or without notice or lapse of time) a violation of or
failure to comply with any term or requirement of any Order to which
Bisassist, or any of the assets owned or used by Bisassist, is subject; and
(iii) Bisassist has not received any notice or other communication
(whether oral or written) from any Governmental Body or any other Person
regarding any actual, alleged,
18
<PAGE>
possible, or potential violation of, or failure to comply with, any term or
requirement of any Order to which Bisassist, or any of the assets owned or
used by Bisassist, is or has been subject.
3.17 Absence of Certain Changes and Events. Except as set forth in Part
3.17 of the Bisassist Disclosure Letter, since the date of the Bisassist Balance
Sheet, Bisassist has conducted Bisassist's business only in the Ordinary Course
of Business and there has not been any:
(a) change in Bisassist's authorized or issued capital stock; grant of any
stock option or right to purchase shares of capital stock of Bisassist; issuance
of any security convertible into such capital stock; grant of any registration
rights; purchase, redemption, retirement, or other acquisition by Bisassist of
any shares of any such capital stock; or declaration or payment of any dividend
or other distribution or payment in respect of shares of capital stock;
(b) amendment to the Organizational Documents of Bisassist;
(c) payment or increase by Bisassist of any bonuses, salaries, or other
compensation to any stockholder, director, officer, or (except in the Ordinary
Course of Business) employee or entry into any employment, severance, or similar
Contract with any director, officer, or employee;
(d) adoption of, or increase in the payments to or benefits pursuant to,
any profit sharing, bonus, deferred compensation, savings, insurance, pension,
retirement, or other employee benefit plan for or with any employees of
Bisassist;
(e) damage to or destruction or loss of any asset or property of Bisassist,
whether or not covered by insurance, materially and adversely affecting the
properties, assets, business, financial condition, or prospects of Bisassist,
taken as a whole;
(f) entry into, termination of, or receipt of notice of termination of (i)
any license, distributorship, dealer, sales representative, joint venture,
credit, or similar agreement, or (ii) any Contract or transaction involving a
total remaining commitment by or to Bisassist of at least $10,000.00;
(g) sale (other than sales of inventory in the Ordinary Course of
Business), lease, or other disposition of any asset or property of Bisassist or
mortgage, pledge, or imposition of any lien or other encumbrance on any material
asset or property of Bisassist, including the sale, lease, or other disposition
of any of the Bisassist Intellectual Property Assets;
(h) cancellation or waiver of any claims or rights with a value to
Bisassist in excess of $10,000.00;
(i) material change in the accounting methods used by Bisassist; or
(j) agreement, whether oral or written, by Bisassist to do any of the
foregoing.
19
<PAGE>
3.18 Contracts; No Defaults.
(a) Part 3.18(a) of the Bisassist Disclosure Letter contains a complete and
accurate list, and Bisassist has delivered to MYG true and complete copies, of
all the Contracts with a value of at least $10,000.00 of Bisassist. Part 3.18(a)
of the Bisassist Disclosure Letter sets forth reasonably complete details
concerning such Contracts, including the parties to the Contracts, the amount of
the remaining commitment of Bisassist pursuant to the Contracts, and Bisassist's
office where details relating to the Contracts are located.
(b) Except as set forth in Part 3.18(b) of the Bisassist Disclosure Letter:
(i) no Shareholder (and no Related Person of any Shareholder) has or
may acquire any rights pursuant to, and no Shareholder has or may become
subject to any obligation or liability pursuant to, any Contract that
relates to the business of, or any of the assets owned or used by,
Bisassist; and
(ii) no officer, director, agent, employee, consultant, or contractor
of Bisassist is obligated by any Contract that purports to limit the
ability of such officer, director, agent, employee, consultant, or
contractor to (A) engage in or continue any conduct, activity, or practice
relating to the business of Bisassist, or (B) assign to Bisassist or to any
other Person any rights to any invention, improvement, or discovery.
(c) Except as set forth in Part 3.18(c) of the Bisassist Disclosure Letter,
each Contract identified or required to be identified in Part 3.18(a) of the
Bisassist Disclosure Letter is in full force and effect and is valid and
enforceable in accordance with its terms.
(d) Except as set forth in Part 3.18(d) of the Bisassist Disclosure Letter:
(i) Bisassist is and has been in full compliance with all applicable
terms and requirements of each Contract pursuant to which Bisassist has or
had any obligation or liability or by which Bisassist or any of the assets
owned or used by Bisassist is or was obligated;
(ii) each other Person that has or had any obligation or liability
pursuant to any Contract pursuant to which Bisassist has or had any rights
is and has been in full compliance with all applicable terms and
requirements of such Contract;
(iii) no event has occurred or circumstance exists that (with or
without notice or lapse of time) may contravene, conflict with, or result
in a violation or breach of, or give Bisassist or other Person the right to
declare a default or exercise any remedy pursuant to, or to accelerate the
maturity or performance of, or to cancel, terminate, or modify, any
Applicable Contract; and
(iv) Bisassist has not given to or received from any other Person any
notice or other communication (whether oral or written) regarding any
actual, alleged, possible, or potential violation or breach of, or default
pursuant to, any Contract.
20
<PAGE>
(e) There are no renegotiations of, attempts to renegotiate, or outstanding
rights to renegotiate any material amounts paid or payable to Bisassist pursuant
to current or completed Contracts with any Person and no such Person has made
written demand for such renegotiation.
(f) The Contracts relating to the sale, design, manufacture, or provision
of products or services by Bisassist have been entered into in the Ordinary
Course of Business and have been entered into without the commission of any act
alone or in concert with any other Person, or any consideration having been paid
or promised, that is or would be in violation of any Legal Requirement.
3.19 Insurance.
(a) Bisassist has delivered to MYG:
(i) true and complete copies of all policies of insurance to which
Bisassist is a party, or any director of Bisassist, is or has been covered
at any time within the three (3) years preceding the date of this
Agreement;
(ii) true and complete copies of all pending applications for policies
of insurance; and
(iii) any statement by the auditor of Bisassist's financial statements
with regard to the adequacy of such entity's coverage or of the reserves
for claims.
(b) Part 3.19(b) of the Bisassist Disclosure Letter describes:
(i) any self-insurance arrangement by or affecting Bisassist,
including any reserves established pursuant thereto;
(ii) any contract or arrangement, other than a policy of insurance,
for the transfer or sharing of any risk by Bisassist; and
(iii) all obligations of Bisassist to third parties with respect to
insurance (including such obligations under leases and service agreements)
and identifies the policy pursuant to which such coverage is provided.
(c) Part 3.19(c) of the Bisassist Disclosure Letter sets forth, by year,
for the current policy year and each of the three (3) preceding policy years:
(i) a summary of the loss experience pursuant to each policy;
(ii) a statement describing each claim pursuant to an insurance policy
for an amount in excess of $10,000.00, which sets forth:
21
<PAGE>
(A) the name of the claimant;
(B) a description of the policy by insurer, type of insurance,
and period of coverage; and
(C) the amount and a brief description of the claim; and
(iii) a statement describing the loss experience for all claims that
were self-insured, including the number and aggregate cost of such claims.
(d) Except as set forth on Part 3.19(d) of the Bisassist Disclosure Letter:
(i) All policies to which Bisassist is a party or that provide
coverage to a Shareholder, Bisassist, or any director or officer of
Bisassist:
(A) are valid, outstanding, and enforceable;
(B) are issued by an insurer that is financially sound and
reputable;
(C) taken together, provide adequate insurance coverage for the
assets and the operations of Bisassist for all risks normally insured
against by a Person carrying on the same business or businesses as
Bisassist;
(D) are sufficient for compliance with all Legal Requirements,
Governmental Authorizations and Contracts to which Bisassist is a
party or by which Bisassist is obligated;
(E) will continue in full force and effect following the
consummation of the Contemplated Transactions; and
(F) do not provide for any retrospective premium adjustment or
other experienced-based liability on the part of Bisassist.
(ii) Neither Bisassist nor any Shareholder has received (A) any
refusal of coverage or any notice that a defense will be afforded with
reservation of rights, or (B) any notice of cancellation or any other
indication that any insurance policy is not now in full force or effect or
will not be renewed or that the issuer of any policy is not willing or able
to perform its obligations pursuant thereto.
22
<PAGE>
(iii) Bisassist has paid all premiums due, and have otherwise
performed all of its obligations, pursuant to each policy to which
Bisassist is a party or that provides coverage to Bisassist or director or
officer thereof.
(iv) Bisassist has given notice to the insurer of all claims that may
be insured thereby.
3.20 Employees.
(a) Part 3.20 of the Bisassist Disclosure Letter contains a complete and
accurate list of the following information for each employee or director of
Bisassist, including each employee on leave of absence or layoff status:
employer; name; job title; current compensation paid or payable and any change
in compensation since January 1, 1997; vacation accrued; and service credited
for purposes of vesting and eligibility to participate pursuant to Bisassist's
pension, retirement, profit-sharing, thrift-savings, deferred compensation,
stock bonus, stock option, cash bonus, employee stock ownership (including
investment credit or payroll stock ownership), severance pay, insurance,
medical, welfare, or vacation plan, other Employee Pension Benefit Plan or
Employee Welfare Benefit Plan, or any other employee benefit plan or any
director plan.
(b) No employee or director of Bisassist is a party to, or is otherwise
obligated by, any agreement or arrangement, including any confidentiality,
noncompetition, or proprietary rights agreement, between such employee or
director and any other Person ("Bisassist Proprietary Rights Agreement") that in
any way adversely affects or will affect (i) the performance of his or her
duties as an employee or director of Bisassist, or (ii) the ability of Bisassist
to conduct its business, including any Bisassist Proprietary Rights Agreement
with any Shareholder or Bisassist by any such employee or director. To
Shareholders' Knowledge, no director, officer, or other key employee of
Bisassist intends to terminate his or her employment with Bisassist.
(c) Part 3.20 of the Bisassist Disclosure Letter also contains a complete
and accurate list of the following information for each retired employee or
director of Bisassist, or their dependents, receiving benefits or scheduled to
receive benefits in the future: name, pension benefit, pension option election,
retiree medical insurance coverage, retiree life insurance coverage, and other
benefits.
3.21 Labor Relations; Compliance. Bisassist has not been or is a party to
any collective bargaining or other labor Contract. There has not been, there is
not presently pending or existing, and there is not Threatened, (a) any strike,
slowdown, picketing, work stoppage, or employee grievance process, (b) any
Proceeding against or affecting Bisassist relating to the alleged violation of
any Legal Requirement pertaining to labor relations or employment matters,
including any charge or complaint filed by an employee or union with the
National Labor Relations Board, the Equal Employment Opportunity Commission, or
any comparable Governmental Body, organizational activity, or other labor or
employment dispute against or affecting Bisassist or its premises, or (c) any
application for certification of a collective bargaining agent. No event has
occurred or circumstance exists that could provide the basis for any work
stoppage or other labor dispute. There is no lockout of any employees by
Bisassist, and no such action is contemplated by Bisassist. Bisassist has
complied in all respects with all Legal Requirements relating to employment,
equal employment opportunity, nondiscrimination, immigration, wages, hours,
benefits, collective bargaining, the payment of social security and similar
taxes, occupational safety and health, and plant closing. Bisassist is not
liable for the payment of any
23
<PAGE>
compensation, damages, taxes, fines, penalties, or other amounts, however
designated, for failure to comply with any of the foregoing Legal Requirements.
3.22 Intellectual Property.
(a) Bisassist (i) owns all the licenses, trademarks, tradenames,
copyrights, marks, patents and applications for patents listed and attributed to
it on Part 3.22(a) of the Bisassist Disclosure Letter (the "Bisassist
Intellectual Property Assets"), (ii) neither owns nor uses any such items which
are not listed in the Bisassist Disclosure Letter, (iii) pays no royalties to
any Person with respect to any such items, and (iv) has full, complete,
unfettered and lawful right to bring actions for the infringement thereof.
Bisassist owns, or possesses adequate and enforceable rights to use, without
payment of royalties, all licenses, trademarks, tradenames, copyrights, patents,
trade secrets and processes necessary for the conduct of, or use in, its
business as the same is presently being conducted.
(b) Except as set forth on Part 3.22(b) of the Bisassist Disclosure Letter,
Bisassist has no Knowledge nor has received any notice to the effect that any
service or product it provides or sells, or any process, method, part or
material it employees in its business for the use by it or another of any such
service, may infringe, or is in conflict with, any asserted right of another
Person. There is no pending or Threatened claim or litigation action against
Bisassist contesting its right to use or the validity of any of the trademarks
or tradenames listed on Part 3.22(a) of the Bisassist Disclosure Letter or
asserting its misuse of any of the foregoing, which would deprive it of the
right to assert its rights pursuant thereto or which would prevent the sale of
any service provided or sold by it.
3.23 Certain Payments. Neither Bisassist nor any director, officer, agent,
or employee of Bisassist, or to Shareholders' Knowledge any other Person
associated with or acting for or on behalf of Bisassist, has directly or
indirectly (a) made any contribution, gift, bribe, rebate, payoff, influence
payment, kickback, or other payment to any Person, private or public, regardless
of form, whether in money, property, or services (i) to obtain favorable
treatment in securing business, (ii) to pay for favorable treatment for business
secured, (iii) to obtain special concessions or for special concessions already
obtained, for or in respect of Bisassist or any Affiliate of Bisassist, or (iv)
in violation of any Legal Requirement, or (b) established or maintained any fund
or asset that has not been recorded in the books and records of Bisassist.
3.24 Disclosure.
(a) No representation or warranty of Shareholders in this Agreement and no
information specified in the Bisassist Disclosure Letter omits to specify a
material fact necessary to make the information specified herein or therein,
considering the circumstances in which that information was furnished, not
misleading.
(b) There is no fact known to any Shareholder that has specific application
to any Shareholder or Bisassist (other than general economic or industry
conditions) and that materially adversely affects or, as far as any Shareholder
can reasonably foresee, materially threatens, the assets,
24
<PAGE>
business, prospects, financial condition, or results of operations of Bisassist
that has not been set forth in this Agreement or the Bisassist Disclosure
Letter.
3.25 Relationships with Related Persons. Except as set forth on Part 3.25
of the Bisassist Disclosure Letter, no Shareholder or any Related Person of
Shareholders or of Bisassist has or has had any interest in any property
(whether real, personal, or mixed and whether tangible or intangible), used in
or pertaining to Bisassist's business. Except as set forth in Part 3.25 of the
Bisassist Disclosure Letter, no Shareholder or any Related Person of
Shareholders or of Bisassist is or has owned (of record or as a beneficial
owner) an equity interest or any other financial or profit interest in, a Person
that has (i) had business dealings or a material financial interest in any
transaction with Bisassist, or (ii) engaged in competition with Bisassist with
respect to any line of the products or services of Bisassist (a "Bisassist
Competing Business") in any market presently served by Bisassist. Except as set
forth in Part 3.25 of the Bisassist Disclosure Letter, no Shareholder or any
Related Person of Shareholders or of Bisassist is a party to any Contract with,
or has any claim or right against, Bisassist.
3.26 Brokers or Finders. Shareholders and their agents have incurred no
obligation or liability, contingent or otherwise, for brokerage or finders' fees
or agents' commissions or other similar payment in connection with this
Agreement.
3.27 Corporate Resolutions. Bisassist has delivered to MYG a certified copy
of the resolutions adopted by the Board of Directors of Bisassist authorizing
execution, delivery and performance of this Agreement and the consummation of
the Reorganization and a certificate of the Secretary of Bisassist, dated the
Effective Date, to the effect that those resolutions were duly adopted and are
in full force and effect and with respect to the authority and incumbency of the
officers of Bisassist executing this Agreement.
3.28 Take or Pay Contracts. Part 3.28 of the Bisassist Disclosure Letter
specifies all Contracts pursuant to which Bisassist is required to purchase a
minimum quantity of utilities, products or services or to make payment therefor.
Bisassist has utilized the minimum quantity of utilities, products or services
that Bisassist is required to utilize pursuant to such Contracts and Bisassist
has made no prepayments for utilities, products or services that Bisassist has
not utilized.
3.29 Banking Relationships. Part 3.29 of the Bisassist Disclosure Letter
specifies the names and locations of all banks, trust companies, savings and
loans associations and other financial institutions at which Bisassist maintains
its safe deposit boxes or accounts of any nature and the names of all persons
authorized to have access there to, draw thereon or make withdrawals therefrom.
Upon request, Bisassist and Shareholders will deliver to MYG copies of all
records, including all signatures or authorization cards and the keys pertaining
to safe deposit boxes.
3.30 Further Assurances. Each Shareholder shall cooperate with MYG and
provide such Shareholder's best efforts to assist MYG in connection with the
continuity and smooth transition of the Bisassist businesses. At any time or
from time to time, each Shareholder shall, at the request of MYG, take any and
all action necessary or appropriate to put MYG in actual possession and control
of Bisassist and shall execute and deliver such further instruments of sale,
conveyance, transfer, assignment and consent and take such other action as MYG
may request in order to sell, convey, transfer, deliver,
25
<PAGE>
assign, and set over to MYG all of the Shares and to confirm the title and
possession thereto or to assist MYG in exercising its rights with respect
thereto.
3.31 Inspection of Books and Records. In recognition that MYG is a
"reporting company" with the National Association of Securities Dealers, Inc.,
and that MYG may be required to include Bisassist's financial history in future
filings, Bisassist agrees that in order to assist MYG and its attorneys,
auditors, officers, directors and agents (collectively, "MYG Agents") to comply
with applicable disclosure requirements, MYG and MYG Agents shall have the right
at any reasonable time to inspect all books, records and documents of any kind
of Bisassist. Such inspection by MYG and MYG Agents may be made in person or by
an agent or attorney, and the right of inspection includes the right to copy and
make abstracts of documents. Bisassist and its officers, directors, employees,
agents and attorneys shall cooperate fully with MYG and MYG Agents in the
preparation of any and all reports which require the reporting of Bisassist's
financial history.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF MYG
MYG represents and warrants to Bisassist and Shareholders, and each of
them, as follows:
4.1 Organization and Good Standing.
(a) MYG is a corporation duly organized, validly existing, and in good
standing pursuant to the laws of its jurisdiction of incorporation, with full
and complete corporate power and authority to conduct its business as it is now
being conducted, to own or use the properties and assets that it purports to own
or use, and to perform all its obligations pursuant to Applicable Contracts. MYG
is duly qualified to do business as a foreign corporation and is in good
standing pursuant to the laws of each state or other jurisdiction in which
either the ownership or use of the properties owned or used by it, or the nature
of the activities conducted by it, requires such qualification.
(b) MYG has delivered to Bisassist true and correct copies of the
Organizational Documents of MYG, as currently in effect.
4.2 Authority; No Conflict.
(a) This Agreement constitutes the legal, valid, and binding obligation of
MYG, enforceable against MYG in accordance with its terms. MYG has the absolute
and unrestricted right, power, authority, and capacity to execute and deliver
this Agreement and to perform its obligations pursuant to this Agreement, and
MYG has the absolute and unrestricted right, power, authority, and capacity to
execute and deliver this Agreement.
26
<PAGE>
(b) Neither the execution and delivery of this Agreement nor the
consummation or performance of any of the Contemplated Transactions will,
directly or indirectly (with or without notice or lapse of time):
(i) contravene, conflict with, or result in a violation of (A) any
provision of the Organizational Documents of MYG, or (B) any resolution
adopted by the Board of Directors or the stockholders of MYG;
(ii) contravene, conflict with, or result in a violation of, or give
any Governmental Body or other Person the right to challenge any of the
Contemplated Transactions or to exercise any remedy or obtain any relief
pursuant to, any Legal Requirement or any Order to which MYG, or any of the
assets owned or used by MYG, may be subject;
(iii) contravene, conflict with, or result in a violation of any of
the terms or requirements of, or give any Governmental Body the right to
revoke, withdraw, suspend, cancel, terminate, or modify, any Governmental
Authorization that is held by MYG or that otherwise relates to the business
of, or any of the assets owned or used by, MYG; or
(iv) contravene, conflict with, or result in a violation or breach of
any provision of, or give any Person the right to declare a default or
exercise any remedy pursuant to, or to accelerate the maturity or
performance of, or to cancel, terminate, or modify, any Applicable
Contract.
MYG is not or will not be required to give any notice to or obtain any
Consent from any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions.
(c) MYG is acquiring the Shares for MYG's own account and not with an
intention of distribution within the meaning of Section 2(11) of the Securities
Act. MYG is an "accredited investor" as such term is defined in Rule 501(a) of
Regulation D promulgated pursuant to the Securities Act.
4.3 Capitalization. The authorized equity securities of MYG consist of
50,000,000 shares of common stock, $.001 par value, of which 5,000 shares are
issued and outstanding, as well as 10,000,000 shares of preferred stock, $.001
par value, of which none are issued and outstanding. No legend or other
reference to any purported Encumbrance appears upon any certificate representing
equity securities of MYG. All of the outstanding equity securities of MYG have
been duly authorized and validly issued and are fully paid and nonassessable.
There are no Contracts relating to the issuance, sale, or transfer of any equity
securities or other securities of MYG. None of the outstanding equity securities
or other securities of MYG was issued in violation of the Securities Act or any
other Legal Requirement. MYG does not own, and except for this Agreement, MYG
has no Contract to acquire, any equity securities or other securities of any
Person or any direct or indirect equity or ownership interest in any other
business.
4.4 Books and Records. The books of account, minute books, stock record
books, and other records of MYG, all of which have been delivered to Bisassist,
are complete and correct and have been maintained in accordance with sound
business practices, including the maintenance of an adequate
27
<PAGE>
system of internal controls. The minute book of MYG contains accurate and
complete records of all meetings held of, and corporate actions taken by, the
stockholders, the Boards of Directors, and committees of the Boards of Directors
of MYG, and no meeting of any such stockholders, Board of Directors, or
committee has been held for which minutes have not been prepared and are not
contained in such minute book. Upon the execution of this Agreement, all of
those books and records will be in the possession of MYG.
4.5 Corporate Resolutions. MYG has delivered to Bisassist a certified copy
of the resolutions adopted by the Board of Directors of MYG authorizing
execution, delivery and performance of this Agreement and the consummation of
the Reorganization and a certificate of the Secretary of MYG, dated the
Effective Date, to the effect that those resolutions were duly adopted and are
in full force and effect and with respect to the authority and incumbency of the
officers of MYG executing this Agreement.
4.6 Financial Statements. MYG has delivered to Bisassist (a) an audited
balance sheet of MYG as at July 6, 2000, and (b) an unaudited balance sheet of
MYG as at September 30, 2000 (the "MYG Balance Sheet"), and the related
unaudited statement of cash flows for the period from July 6, 2000 (inception)
to September 30, 2000. Such financial statements and notes fairly present the
financial condition and the results of operations, changes in stockholders'
equity, and cash flow of MYG as at the respective dates of and for the periods
referred to in such financial statements, all in accordance with GAAP, subject,
in the case of interim financial statements, to normal recurring year-end
adjustments (the effect of which will not, individually or in the aggregate, be
materially adverse) and the absence of notes; the financial statements referred
to in this Section 4.6 present the consistent application of such accounting
principles throughout the periods involved. No financial statements of any
Person other than MYG are required by GAAP to be included in the financial
statements of MYG.
4.7 No Undisclosed Liabilities. Except as set forth in Part 4.7 of the MYG
Disclosure Letter, MYG has no liabilities or obligations of any nature (whether
known or unknown and whether absolute, accrued, contingent, or otherwise) except
for liabilities or obligations specified or reserved against in the MYG Balance
Sheet or the MYG Interim Balance Sheet and current liabilities incurred in the
Ordinary Course of Business since the respective dates thereof.
4.8 Taxes.
(a) MYG has filed or caused to be filed on a timely basis all Tax Returns
that are or were required to be filed by or with respect to any of them, either
separately or as a member of a group of corporations, pursuant to applicable
Legal Requirements. MYG has delivered to Bisassist copies of all such Tax
Returns filed since July 6, 2000. MYG has paid, or made provision for the
payment of, all Taxes that have or may have become due pursuant to those Tax
Returns or otherwise, or pursuant to any assessment received by Shareholders or
MYG, except such Taxes, if any, as are listed in Part 4.8 of the MYG Disclosure
Letter and are being contested in good faith and as to which adequate reserves
(determined in accordance with GAAP) have been provided in the MYG Balance Sheet
and the MYG Interim Balance Sheet.
28
<PAGE>
(b) Part 4.8 of the MYG Disclosure Letter contains a complete and accurate
list of all audits of all such Tax Returns, including a reasonably detailed
description of the nature and outcome of each audit. All deficiencies proposed
as a result of such audits have been paid, reserved against, settled, or, as
described in Part 4.8 of the MYG Disclosure Letter, are being contested in good
faith by appropriate proceedings. Part 4.8 of the MYG Disclosure Letter
describes all adjustments to the United States federal income Tax Returns filed
by MYG for all taxable years and the resulting deficiencies proposed by the IRS.
Except as described in Part 4.8 of the MYG Disclosure Letter, neither MYG or any
Shareholder has given or been requested to give waivers or extensions (or is or
would be subject to a waiver or extension given by any other Person) of any
statute of limitations relating to the payment of Taxes of MYG or for which MYG
may be liable.
(c) The charges, accruals and reserves with respect to Taxes on the books
of MYG are adequate (determined in accordance with GAAP) and are at least equal
to MYG's liability for Taxes. There exists no proposed tax assessment against
MYG, except as disclosed in the MYG Balance Sheet or in Part 4.8 of the MYG
Disclosure Letter. No consent to the application of Section 341(f)(2) of the IRC
has been filed with respect to any property or assets held, acquired, or to be
acquired by MYG. All Taxes that MYG is or was required by Legal Requirements to
withhold or collect have been duly withheld or collected and, to the extent
required, have been paid to the proper Governmental Body or other Person.
(d) All Tax Returns filed by (or that include on a consolidated basis) MYG
are true, correct, and complete. There is no tax sharing agreement that will
require any payment by MYG after the date of this Agreement.
4.9 No Material Adverse Change. Since the date of the MYG Balance Sheet,
there has not been any material adverse change in the business, operations,
properties, prospects, assets, or condition of MYG, and no event has occurred or
circumstance exists that may result in such a material adverse change.
4.10 Compliance with Legal Requirements; Governmental Authorizations.
(a) Except as set forth in Part 4.10 of the MYG Disclosure Letter:
(i) MYG is and has been in full compliance with each Legal Requirement
that is or was applicable to it or to the conduct or operation of its
business or the ownership or use of any of its assets;
(ii) no event has occurred or circumstance exists that (with or
without notice or lapse of time) (A) may constitute or result in a
violation by MYG of, or a failure on the part of MYG to comply with, any
Legal Requirement, or (B) may give result in any obligation on the part of
MYG to undertake, or to pay all or any portion of the cost of, any remedial
action of any nature, including pursuant to any Environmental, Health, and
Safety Liability; and
29
<PAGE>
(iii) MYG has not received any notice or other communication (whether
oral or written) from any Governmental Body or any other Person regarding
(A) any actual, alleged, possible, or potential violation of, or failure to
comply with, any Legal Requirement, or (B) any actual, alleged, possible,
or potential obligation on the part of MYG to undertake, or to pay all or
any portion of the cost of, any remedial action of any nature, including
pursuant to any Environmental, Health, and Safety Liability.
4.11 Legal Proceedings; Orders.
(a) Except as set forth in Part 4.11 of the MYG Disclosure Letter, there is
no pending Proceeding:
(i) that has been commenced by or against MYG or that otherwise
relates to or may affect the business of, or any of the assets owned or
used by, MYG; or
(ii) that challenges, or that may have the effect of preventing,
delaying, making illegal, or otherwise interfering with, any of the
Contemplated Transactions.
To the Knowledge of MYG, (1) no such Proceeding has been Threatened, and (2) no
event has occurred or circumstance exists that may give result in or serve as a
basis for the commencement of any such Proceeding. MYG has delivered to
Bisassist copies of all pleadings, correspondence, and other documents relating
to each Proceeding listed in Part 4.11 of the MYG Disclosure Letter. The
Proceedings listed in Part 4.11 of the MYG Disclosure Letter will not have a
material adverse effect on the business, operations, assets, condition, or
prospects of MYG.
(b) Except as set forth in Part 4.11 of the MYG Disclosure Letter:
(i) there is no Order to which MYG, or any of the assets owned or used
by MYG, is subject;
(ii) no MYG shareholder is subject to any Order that relates to the
business of, or any of the assets owned or used by, MYG; and
(iii) no officer, director, agent, or employee of MYG is subject to
any Order that prohibits such officer, director, agent, or employee from
engaging in or continuing any conduct, activity, or practice relating to
the business of MYG.
(c) Except as set forth in Part 4.11 of the MYG Disclosure Letter:
(i) MYG is and has been in full compliance with all of the terms and
requirements of each Order to which it, or any of the assets owned or used
by it, is or has been subject;
30
<PAGE>
(ii) no event has occurred or circumstance exists that may constitute
or result in (with or without notice or lapse of time) a violation of or
failure to comply with any term or requirement of any Order to which MYG,
or any of the assets owned or used by MYG, is subject; and
(iii) MYG has not received any notice or other communication (whether
oral or written) from any Governmental Body or any other Person regarding
any actual, alleged, possible, or potential violation of, or failure to
comply with, any term or requirement of any Order to which MYG, or any of
the assets owned or used by MYG, is or has been subject.
4.12 Absence of Certain Changes and Events. Except as set forth in Part
4.12 of the MYG Disclosure Letter, since the date of the MYG Balance Sheet, MYG
has conducted MYG's business only in the Ordinary Course of Business and there
has not been any:
(a) change in MYG's authorized or issued capital stock; grant of any stock
option or right to purchase shares of capital stock of MYG; issuance of any
security convertible into such capital stock; grant of any registration rights;
purchase, redemption, retirement, or other acquisition by MYG of any shares of
any such capital stock; or declaration or payment of any dividend or other
distribution or payment in respect of shares of capital stock;
(b) amendment to the Organizational Documents of MYG;
(c) payment or increase by MYG of any bonuses, salaries, or other
compensation to any stockholder, director, officer, or (except in the Ordinary
Course of Business) employee or entry into any employment, severance, or similar
Contract with any director, officer, or employee;
(d) adoption of, or increase in the payments to or benefits pursuant to,
any profit sharing, bonus, deferred compensation, savings, insurance, pension,
retirement, or other employee benefit plan for or with any employees of MYG;
(e) damage to or destruction or loss of any asset or property of MYG,
whether or not covered by insurance, materially and adversely affecting the
properties, assets, business, financial condition, or prospects of MYG, taken as
a whole;
(f) entry into, termination of, or receipt of notice of termination of (i)
any license, distributorship, dealer, sales representative, joint venture,
credit, or similar agreement, or (ii) any Contract or transaction involving a
total remaining commitment by or to MYG of at least $10,000.00;
(g) sale (other than sales of inventory in the Ordinary Course of
Business), lease, or other disposition of any asset or property of MYG or
mortgage, pledge, or imposition of any lien or other encumbrance on any material
asset or property of MYG;
(h) cancellation or waiver of any claims or rights with a value to MYG in
excess of $10,000.00;
31
<PAGE>
(i) material change in the accounting methods used by MYG; or
(j) agreement, whether oral or written, by MYG to do any of the foregoing.
4.13 Contracts; No Defaults.
(a) Part 4.13(a) of the MYG Disclosure Letter contains a complete and
accurate list, and MYG has delivered to Bisassist true and complete copies, of
all the Contracts with a value of at least $10,000.00 of MYG. Part 4.13(a) of
the MYG Disclosure Letter sets forth reasonably complete details concerning such
Contracts, including the parties to the Contracts, the amount of the remaining
commitment of MYG pursuant to the Contracts, and MYG's office where details
relating to the Contracts are located.
(b) Except as set forth in Part 4.13(b) of the MYG Disclosure Letter, each
Contract identified or required to be identified in Part 4.13(a) of the MYG
Disclosure Letter is in full force and effect and is valid and enforceable in
accordance with its terms.
(c) Except as set forth in Part 4.13(c) of the MYG Disclosure Letter:
(i) MYG is and has been in full compliance with all applicable terms
and requirements of each Contract pursuant to which MYG has or had any
obligation or liability or by which MYG or any of the assets owned or used
by MYG is or was obligated;
(ii) each other Person that has or had any obligation or liability
pursuant to any Contract pursuant to which MYG has or had any rights is and
has been in full compliance with all applicable terms and requirements of
such Contract;
(iii) no event has occurred or circumstance exists that (with or
without notice or lapse of time) may contravene, conflict with, or result
in a violation or breach of, or give MYG or other Person the right to
declare a default or exercise any remedy pursuant to, or to accelerate the
maturity or performance of, or to cancel, terminate, or modify, any
Applicable Contract; and
(iv) MYG has not given to or received from any other Person any notice
or other communication (whether oral or written) regarding any actual,
alleged, possible, or potential violation or breach of, or default pursuant
to, any Contract.
(d) There are no renegotiations of, attempts to renegotiate, or outstanding
rights to renegotiate any material amounts paid or payable to MYG pursuant to
current or completed Contracts with any Person and no such Person has made
written demand for such renegotiation.
4.14 Certain Payments. Neither MYG nor any director, officer, agent, or
employee of MYG, or to MYG's Knowledge, any other Person associated with or
acting for or on behalf of MYG, has
32
<PAGE>
directly or indirectly (a) made any contribution, gift, bribe, rebate, payoff,
influence payment, kickback, or other payment to any Person, private or public,
regardless of form, whether in money, property, or services (i) to obtain
favorable treatment in securing business, (ii) to pay for favorable treatment
for business secured, (iii) to obtain special concessions or for special
concessions already obtained, for or in respect of MYG or any Affiliate of MYG,
or (iv) in violation of any Legal Requirement, or (b) established or maintained
any fund or asset that has not been recorded in the books and records of MYG.
4.15 Disclosure.
(a) No representation or warranty of MYG in this Agreement and no
information specified in the MYG Disclosure Letter omits to specify a material
fact necessary to make the information specified herein or therein, considering
the circumstances in which that information was furnished, not misleading.
(b) There is no fact known to MYG that has specific application to MYG
(other than general economic or industry conditions) and that materially
adversely affects or, as far as MYG can reasonably foresee, materially
threatens, the assets, business, prospects, financial condition, or results of
operations of MYG that has not been set forth in this Agreement or the MYG
Disclosure Letter.
4.16 Relationships with Related Persons. Except as set forth on Part 4.16
of the MYG Disclosure Letter, no shareholder of MYG or any Related Person of
shareholder of MYG has or has had any interest in any property (whether real,
personal, or mixed and whether tangible or intangible), used in or pertaining to
MYG's business. Except as set forth in Part 4.16 of the MYG Disclosure Letter,
no shareholder of MYG or any Related Person of a shareholder of MYG is or has
owned (of record or as a beneficial owner) an equity interest or any other
financial or profit interest in, a Person that has (i) had business dealings or
a material financial interest in any transaction with MYG, or (ii) engaged in
competition with MYG with respect to any line of the products or services of MYG
(a "MYG Competing Business") in any market presently served by MYG. Except as
set forth in Part 4.16 of the MYG Disclosure Letter, no shareholder of MYG or
any Related Person of a shareholder of MYG, is a party to any Contract with, or
has any claim or right against, MYG.
4.17 Brokers or Finders. MYG and its agents have incurred no obligation or
liability, contingent or otherwise, for brokerage or finders' fees or agents'
commissions or other similar payment in connection with this Agreement.
4.18 Corporate Resolutions. MYG has delivered to Bisassist a certified copy
of the resolutions adopted by the Board of Directors of MYG authorizing
execution, delivery and performance of this Agreement and the consummation of
the Reorganization and a certificate of the Secretary of MYG, dated the
Effective Date, to the effect that those resolutions were duly adopted and are
in full force and effect and with respect to the authority and incumbency of the
officers of MYG executing this Agreement.
4.19 Banking Relationships. Part 4.19 of the MYG Disclosure Letter
specifies the names and locations of all banks, trust companies, savings and
loans associations and other financial institutions at
33
<PAGE>
which MYG maintains its safe deposit boxes or accounts of any nature and the
names of all persons authorized to have access there to, draw thereon or make
withdrawals therefrom.
ARTICLE V
INDEMNIFICATION; REMEDIES
5.1 Survival; Right to Indemnification Not Affected by Knowledge. All
representations, warranties, covenants, and obligations in this Agreement, the
Disclosure Letters, the certificates delivered pursuant to Sections 2.3(a)(i)
and 2.3(b)(i), and any other certificate or document delivered pursuant to this
Agreement will survive this Agreement. The right to indemnification, payment of
Damages or other remedy based on such representations, warranties, covenants,
and obligations will not be affected by any investigation conducted with respect
to, or any Knowledge acquired (or capable of being acquired) at any time,
whether before or after the execution and delivery of this Agreement, with
respect to the accuracy or inaccuracy of or compliance with, any such
representation, warranty, covenant, or obligation. The waiver of any condition
based on the accuracy of any representation or warranty, or on the performance
of or compliance with any covenant or obligation, will not affect the right to
indemnification, payment of Damages, or other remedy based on such
representations, warranties, covenants, and obligations.
5.2 Indemnification and Payment of Damages by Majority Shareholders.
Shareholders, jointly and severally, will indemnify and hold harmless MYG, and
MYG's respective Representatives, stockholders, controlling persons, and
affiliates (collectively, the "MYG Indemnified Persons") for, and will pay to
the Indemnified Persons the amount of, any loss, liability, claim, damage
(including incidental and consequential damages), expense (including reasonable
costs of investigation and defense and reasonable attorneys' fees) or diminution
of value, whether or not involving a third-party claim (collectively,
"Damages"), arising, directly or indirectly, from or in connection with:
(a) any Breach of any representation or warranty made by Shareholders or
Bisassist in this Agreement, the Bisassist Disclosure Letter, or any other
certificate or document delivered by Shareholders or Bisassist pursuant to this
Agreement;
(b) any Breach by any Shareholder or Bisassist of any covenant or
obligation of such Shareholder or Bisassist in this Agreement; or
(c) any claim by any Person for brokerage or finder's fees or commissions
or similar payments based upon any agreement or understanding alleged to have
been made by any such Person with any Shareholder or Bisassist (or any Person
acting on their behalf) in connection with any of the Contemplated Transactions.
The remedies provided in this Section 5.2 will not be exclusive of or limit
any other remedies that may be available to MYG or the MYG Indemnified Persons.
34
<PAGE>
5.3 Indemnification and Payment of Damages by MYG. MYG will indemnify and
hold harmless Shareholders and Bisassist, and Shareholders and Bisassist's
respective Representatives, stockholders, controlling persons, and affiliates
(collectively, the "Shareholders and Bisassist Indemnified Persons") for, and
will pay to the Shareholders and Bisassist Indemnified Persons the amount of,
any loss, liability, claim, damage (including incidental and consequential
damages), expense (including reasonable costs of investigation and defense and
reasonable attorneys' fees) or diminution of value, whether or not involving a
third-party claim (collectively, "Damages"), arising, directly or indirectly,
from or in connection with:
(a) any Breach of any representation or warranty made by MYG in this
Agreement, the Disclosure Letter, or any other certificate or document delivered
by MYG pursuant to this Agreement;
(b) any Breach by MYG of any covenant or obligation of MYG in this
Agreement; or
(c) any claim by any Person for brokerage or finder's fees or commissions
or similar payments based upon any agreement or understanding alleged to have
been made by any such Person with MYG (or any Person acting on their behalf) in
connection with any of the Contemplated Transactions.
The remedies provided in this Section 5.3 will not be exclusive of or limit
any other remedies that may be available to Shareholders and Bisassist or the
Shareholders and Bisassist Indemnified Persons.
5.4 Procedure for Indemnification -- Third Party Claims.
(a) Promptly after receipt by a Person indemnified pursuant to this Article
V of notice of the commencement of any Proceeding against it, such indemnified
Person will, if a claim is to be made against an indemnifying Person pursuant to
this Article V, give notice to the indemnifying Person of the commencement of
such claim, but the failure to notify the indemnifying Person will not relieve
the indemnifying Person of any liability that it may have to any indemnified
Person, except to the extent that the indemnifying Person demonstrates that the
defense of such claim is prejudiced by the indemnifying Person's failure to give
such notice.
(b) If any Proceeding referred to in Section 5.4(a) is brought against an
indemnified Person and it gives notice to the indemnifying Person of the
commencement of such Proceeding, the indemnifying Person will, unless the claim
involves Taxes, be entitled to participate in such Proceeding and, to the extent
that it desires (unless (i) the indemnifying Person is also a party to such
Proceeding and the indemnified Person determines in good faith that joint
representation would be inappropriate, or (ii) the indemnifying Person fails to
provide reasonable assurance to the indemnified Person of its financial capacity
to defend such Proceeding and provide indemnification with respect to such
Proceeding), to assume the defense of such Proceeding with counsel satisfactory
to the indemnified Person and, after notice from the indemnifying Person to the
indemnified Person of its election to assume the defense of such Proceeding, the
indemnifying Person will not, as long as it diligently conducts such defense, be
liable to the indemnified Person pursuant to this Article V for any fees of
35
<PAGE>
other counsel or any other expenses with respect to the defense of such
Proceeding, in each case subsequently incurred by the indemnified Person in
connection with the defense of such Proceeding, other than reasonable costs of
investigation. If an indemnifying Person assumes the defense of a Proceeding,
(i) it will be conclusively established for purposes of this Agreement that the
claims made in that Proceeding are within the scope of and subject to
indemnification; (ii) no compromise or settlement of such claims may be effected
by the indemnifying Person without the indemnified Person's consent, unless (A)
there is no finding or admission of any violation of Legal Requirements or any
violation of the rights of any Person and no effect on any other claims that may
be made against the indemnified Person, and (B) the sole relief provided is
monetary damages that are paid in full by the indemnifying Person; and (iii) the
indemnified Person will have no liability with respect to any compromise or
settlement of such claims effected without its consent. If notice is given to an
indemnifying Person of the commencement of any Proceeding and the indemnifying
Person does not, within 10 days after the indemnified Person's notice is given,
give notice to the indemnified Person of its election to assume the defense of
such Proceeding, the indemnifying Person will be obligated by any determination
made in such Proceeding or any compromise or settlement effected by the
indemnified Person.
(c) Notwithstanding the foregoing, if an indemnified Person determines in
good faith that there is a reasonable probability that a Proceeding may
adversely affect it or its affiliates other than as a result of monetary damages
for which it would be entitled to indemnification under this Agreement, the
indemnified Person may, by notice to the indemnifying Person, assume the
exclusive right to defend, compromise, or settle such Proceeding, but the
indemnifying Person will not be obligated by any determination of a Proceeding
so defended or any compromise or settlement effected without its consent (which
shall not be unreasonably withheld).
(d) Shareholders hereby consent to the non-exclusive jurisdiction of any
court in which a Proceeding is brought against any MYG Indemnified Person for
purposes of any claim that a MYG Indemnified Person may have pursuant to this
Agreement with respect to such Proceeding or the matters alleged therein, and
agree that process may be served on Shareholders with respect to such a claim
anywhere in the world.
5.5 Procedure for Indemnification-- Other Claims. A claim for
indemnification for any matter not involving a third-party claim may be asserted
by notice to the party from whom indemnification is sought.
ARTICLE VI
GENERAL PROVISIONS
6.1 Expenses. Except as otherwise expressly provided in this Agreement,
each party shall pay all expenses, costs and fees (including attorneys' fees)
incurred by that party in connection with the Contemplated Transactions,
including the preparation, execution and delivery of this Agreement and the
ancillary agreements, schedules and documents related to the Contemplated
Transactions.
36
<PAGE>
6.2 Public Announcements. Any public announcement or similar publicity with
respect to this Agreement or the Contemplated Transactions will be issued, if at
all, at such time and in such manner as MYG and Shareholders shall mutually
determine. Shareholders and MYG will consult with each other concerning the
communication by which Bisassist's employees, customers, and suppliers and other
Persons having dealings with Bisassist will be informed of the Contemplated
Transactions, and MYG will have the right to be present for any such
communication.
6.3 Notices. All notices, consents, waivers, and other communications
pursuant to this Agreement must be in writing and will be deemed to have been
duly given when (a) delivered by hand (with written confirmation of receipt),
(b) sent by facsimile machine (with written confirmation of receipt), provided
that a copy is mailed by registered mail, return receipt requested, or (c) when
received by the addressee, if sent by a nationally recognized overnight delivery
service (receipt requested), in each case to the appropriate addresses and
facsimile machine numbers set forth below (or to such other addresses and
facsimile machine numbers as a party may designate by notice to the other
parties):
If to the Shareholders:
To the individuals, at the addresses set forth in Exhibit A.
Bisassist:
Bisassist, Inc.
1353 Middleton Drive, Suite #200
Cedar Hill, Texas 75104
MYG:
MYG Corp.
23 Corporate Plaza, Suite 180
Newport Beach, California 92663
6.4 Jurisdiction; Service of Process. Any action or proceeding seeking to
enforce any provision of, or based on any right resulting from, this Agreement
may be brought against any of the parties in the courts of the State of
California, County of Orange, or, if it has or can acquire jurisdiction, in the
United States District Court for the Central District of California, and each of
the parties consents to the jurisdiction of such courts (and of the appropriate
appellate courts) in any such action or proceeding and waives any objection to
venue. Process in any action or proceeding referred to in the preceding sentence
may be served on any party anywhere in the world.
6.5 Further Assurances. The parties agree (a) to furnish upon request to
each other such additional information, (b) to execute and deliver to each other
such other documents, and (c) to do such other acts and things, all as the other
parties may reasonably request for the purpose of carrying out the intent of
this Agreement and the documents referred to in this Agreement.
37
<PAGE>
6.6 Waiver. The rights and remedies of the parties to this Agreement are
cumulative and not alternative. Neither the failure nor any delay by any party
in exercising any right, power, or privilege pursuant to this Agreement or the
documents referred to in this Agreement will operate as a waiver of such right,
power, or privilege, and no single or partial exercise of any such right, power,
or privilege will preclude any other or further exercise of such right, power,
or privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (a) no claim or right resulting from
this Agreement or the documents referred to in this Agreement can be discharged
by one party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing signed by the other party; (b) no waiver that may be
given by a party will be applicable except in the specific instance for which it
is given; and (c) no notice to or demand on one party will be deemed to be a
waiver of any obligation of such party or of the right of the party giving such
notice or demand to take further action without notice or demand as provided in
this Agreement or the documents referred to in this Agreement.
6.7 Entire Agreement and Modification. This Agreement supersedes all prior
agreements between the parties with respect to its subject matter and
constitutes (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the Agreement between the parties with
respect to its subject matter. This Agreement may not be amended except by a
written Agreement executed by the party to be charged with any such amendment.
6.8 Bisassist Disclosure Letter.
(a) The disclosures in the Bisassist Disclosure Letter must relate only to
the representations and warranties in the section of the Agreement to which it
expressly relates and not to any other representation or warranty in this
Agreement.
(b) In the event of any inconsistency between the statements in this
Agreement and those in the Bisassist Disclosure Letter (other than an exception
expressly set forth as such in such Disclosure Letter with respect to a
specifically identified representation or warranty), the provisions of this
Agreement will prevail and control.
6.9 Assignments, Successors, and No Third-party Rights. No party may assign
any of its rights pursuant to this Agreement without the prior written consent
of the other parties, and any such assignment shall be null and void ab initio;
provided, however, that MYG may assign any of its rights pursuant to this
Agreement to any Subsidiary of MYG. Subject to the preceding sentence, this
Agreement will apply to, obligate in all respects, and inure to the benefit of,
the successors and permitted assigns of the parties. Nothing expressed or
referred to in this Agreement will be construed to give any Person, other than
the parties to this Agreement, any legal or equitable right, remedy, or claim
pursuant to or with respect to this Agreement or any provision of this
Agreement. This Agreement and all of its provisions and conditions are for the
sole and exclusive benefit of the parties to this Agreement and their successors
and assigns.
6.10 Severability. If any provision of this Agreement is determined to be
invalid or unenforceable by any court of competent jurisdiction, the other
provisions of this Agreement will remain in full force and effect. Any provision
of this Agreement determined to be invalid or unenforceable only
38
<PAGE>
in part or degree will remain in full force and effect to the extent not
determined to be invalid or unenforceable.
6.11 Section Headings, Construction. The headings of sections in this
Agreement are provided for convenience only and will not affect its construction
or interpretation. All references to "section" or "sections" refer to the
corresponding section or sections of this Agreement. All words used in this
Agreement will be construed to be of such gender or number as the circumstances
require. Unless otherwise expressly provided, the word "including" does not
limit the preceding words or terms.
6.12 Time of Essence. With regard to all dates and time periods set forth
or referred to in this Agreement, time is of the essence.
6.13 Governing Law. This Agreement will be governed by the laws of the
State of California, without regard to conflicts of laws principles.
6.14 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same Agreement.
THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.
39
<PAGE>
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the Effective Date.
MYG Corp.,
a Nevada corporation
By: /s/ Bruce Younker
--------------------------------
Bruce Younker
Its: President
By: /s/ Bruce Younker
--------------------------------
Bruce Younker
Its: Secretary
Bisassist, Inc.,
a Texas corporation
By: /s/ Calvin Mees
--------------------------------
Calvin Mees
Its: President
By: /s/ Romie Krickbaum
--------------------------------
Romie Krickbaum
Its: Secretary
Shareholders of Bisassist, Inc.
By: /s/ Calvin Mees
--------------------------------
Calvin Mees
Their: Agent and Attorney-in-Fact
40
<PAGE>
Form of Bisassist Disclosure Letter
December 20, 2000
MYG Corp.
23 Corporate Plaza, Suite 180
Newport Beach, California 92663
Gentlemen:
We refer to the Stock Acquisition and Reorganization Agreement (the
"Agreement") to be entered into effective today between the persons specified in
Exhibit A of the Agreement ("Shareholders"); Bisassist, Inc., a Texas
corporation ("Bisassist"); and MYG Corp., a Nevada corporation ("MYG"), pursuant
to which Shareholders exchanged with MYG and MYG acquired from Shareholders
9,980,000 shares of $.001 par common stock of Bisassist, which is 100% of the
issued and outstanding $.001 par common stock of Bisassist, on the terms and
subject to the conditions specified in the Agreement.
This letter constitutes the Bisassist Disclosure Letter referred to in the
Agreement. The representations and warranties of Bisassist and Shareholders in
the Agreement are made and given subject to the disclosures in this Bisassist
Disclosure Letter. The disclosures in this Bisassist Disclosure Letter are to be
taken as relating to the representations and warranties in the section of the
Agreement to which they expressly relate and to no other representation or
warranty in the Agreement.
Terms defined in the Agreement are used with the same meanings in this
Bisassist Disclosure Letter. References to Appendices are to the Appendices to
this Bisassist Disclosure Letter.
By reference to Section 3 of the Agreement (using the numbering in such
section), the following matters are disclosed:
Very truly yours,
Bisassist, Inc.,
a Texas corporation
By:
-------------------------------
Calvin Mees
Its: President
By:
-------------------------------
Romie Krickbaum
Its: Secretary
41
<PAGE>
MYG acknowledges receipt of the Bisassist Disclosure Letter of which this is a
duplicate (including the Appendices referred to therein).
Dated: December 20, 2000
MYG Corp.,
a Nevada corporation
By:
------------------------------
Bruce Younker
Its: President
By:
------------------------------
Bruce Younker
Its: Secretary
42
<PAGE>
Form of MYG Disclosure Letter
December 20, 2000
Bisassist, Inc.
1353 Middleton Drive, Suite #200
Cedar Hill, Texas 75104
Gentlemen:
We refer to the Stock Acquisition and Reorganization Agreement (the
"Agreement") to be entered into effective today between the persons specified in
Exhibit A of the Agreement ("Shareholders"); Bisassist, Inc., a Texas
corporation ("Bisassist"); and MYG Corp., a Nevada corporation ("MYG"), pursuant
to which Shareholders exchanged with MYG and MYG acquired from Shareholders
9,980,000 shares of $.001 par common stock of Bisassist, which is 100% of the
issued and outstanding $.001 par common stock of Bisassist, on the terms and
subject to the conditions specified in the Agreement.
This letter constitutes the MYG Disclosure Letter referred to in the
Agreement. The representations and warranties of MYG in the Agreement are made
and given subject to the disclosures in this MYG Disclosure Letter. The
disclosures in this MYG Disclosure Letter are to be taken as relating to the
representations and warranties in the section of the Agreement to which they
expressly relate and to no other representation or warranty in the Agreement.
Terms defined in the Agreement are used with the same meanings in this MYG
Disclosure Letter. References to Appendices are to the Appendices to this MYG
Disclosure Letter.
By reference to Section 3 of the Agreement (using the numbering in such
section), the following matters are disclosed:
Very truly yours,
MYG Corp.,
a Nevada corporation
By:
-------------------------------
Bruce Younker
Its: President
By:
-------------------------------
Bruce Younker
Its: Secretary
43
<PAGE>
Bisassist acknowledges receipt of the MYG Disclosure Letter of which this is a
duplicate (including the Appendices referred to therein).
Dated: December 20, 2000
Bisassist, Inc.,
a Texas corporation
By:
-------------------------------
Calvin Mees
Its: President
By:
-------------------------------
Romie Krickbaum
Its: Secretary
44
<PAGE>
EXHIBIT A
---------
<TABLE>
<CAPTION>
SHAREHOLDER ADDRESS
----------- -------
<S> <C> <C>
Tarja Morado 1353 Middleton Drive, Cedar Hill, TX 75104 3,000,000
Cal Mees 1353 Middleton Drive, Cedar Hill, TX 75104 1,500,000
Romie Krickbaum 708 Hillcrest Court, Cedar Hill, TX 75104 1,500,000
Ralph Rodriguez 1334 Boyd Street, Cedar Hill, TX 75104 400,000
Kevin Krickbaum 820 Preston Road, Red Oak, TX 75154 400,000
Arlin Mees 4727 Thunder Road, Dallas, TX 75244 400,000
Addie McConachie 704 Bridgeport Dr.#3, Bismarck, ND 58504 400,000
Wade Vogel 1108 27th Ave. NW, Mandan, ND 58554 400,000
Steve Wolff 208 5th Ave. NW, Mandan, ND 58554 400,000
Tammy Hayes 2021 N. 3rd Street, Bismarck, ND 58501 400,000
Ladonna Richardson 1455 N.W. Outrigger Loop, Oak Harbor, WA 98277 400,000
Norma Ballard 1525 Jesse Ramsey Blvd., Cedar Hill, TX 75104 400,000
Maria Morado 2736 McKinney Dr., Lancaster, TX 75146 200,000
Judy Heck 204 Veretta Street, Mandan, ND 58554 7,500
Don Vogel 701 39th Street N. Mandan, ND 58554 7,500
John Gardner 1280 Caldara Drive, Co. Sp., CO 80904 7,500
Bill Kramer 3840 Brookside Drive, Bedford, TX 76021 7,500
Larry Nieters 3727 Kingston Drive, Bismarck, ND 58501 7,500
Randy Binegar 1964 N. 20th Street, Bismarck, ND 58501 7,500
Carmen Meisner 780 W. County Road, Roseville, MN 55113 7,500
Orlando Robinson 1627 Highpointe Lane, Cedar Hill, TX 75104 7,500
Lou Prouse 211 Bob White, Desoto, TX 75123 5,000
Bette Gregorio 2043 Noble View Drive, Rancho Palos Verdes, CA 90275 5,000
Lori Burden 1125 Garden Terrace, Irving, TX 75060 5,000
</TABLE>
Page 1 of 2
<PAGE>
<TABLE>
<CAPTION>
SHAREHOLDER ADDRESS
----------- -------
<S> <C> <C>
Joy Brown 8323 E. Valley Ranch #517, Irving, TX 75038 5,000
Kelly Charles 87 Sea Holly Way, Henderson, NV 89014 5,000
Barry Wentz P.O. Box 25, Napoleon, ND 58561 5,000
Bill Hopkins 1108 Hidden Ridge #2035, Irving, TX 75038 5,000
Todd Broadway 2613 Brookdale Rd. #3, Moorhead, MN 56560 5,000
Brian Hall #8 Emeraude Way, Aliso Viejo, CA 92656 5,000
Ron Terranova 8533 Vividviolet, Las Vegas, NV 89131 5,000
Jim Allen 7536 Aberdon Rd, Dallas, TX 75252 5,000
Dave Cawthon 13907 Montfort Dr. #1222, Dallas, TX 75240 5,000
Dave Clifton 753 Bandit Trail, Keller, TX 76180 5,000
Dan Johnk 9794 Forest Lane #128, Dallas, TX 75243 5,000
Aaron Solgarnck 2419 Ellis St. #554, Dallas, TX 75204 5,000
Larry Mees 1714 Marian Dr., Bismarck, ND 58501 5,000
Craig Johnson 567 Lakeview Dr., Woodbury, MN 55129 40,000
</TABLE>
Page 2 of 2
