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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 30, 1998
NEXT GENERATION MEDIA CORP.
(Exact name of registrant as specified in its charter)
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Nevada 2-74785-B 88-0169543
(State of (Commission File Number) (IRS Employer
incorporation) Identification No.)
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900 North Stafford Street, Suite 2003, Arlington, Virginia 22203
(Address of principal executive offices)
Registrant's telephone number: (703) 516-9888
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
(a) In the second quarter of 1998, the registrant initiated a series of
transactions that are intended to result in the acquisition of United Marketing
Solutions Inc., a Virginia corporation ("UMSI"), engaged in the cooperative
direct mail marketing business and the sole operating subsidiary of UNICO, Inc.,
a Delaware corporation ("Unico"). The registrant reported these transactions in
a current report on Form 8-K dated May 26, 1998.
On December 30, 1998, the registrant and Unico executed an Amended and
Restated Stock Purchase Agreement to provide for the acquisition of all of the
issued and outstanding stock of UMSI and the merger of UMSI into a special
purpose subsidiary of the registrant with UMSI as the surviving corporation,
thereby resulting in UMSI becoming a wholly owned subsidiary of the registrant
(the "Transaction"). The Amended and Restated Stock Purchase Agreement differed
from the original Stock Purchase Agreement in certain significant aspects,
including: (1) the registrant shall pay consideration in the form of cash only
(instead of a combination of cash and securities of the registrant) to Unico,
totalling $172,665, for 100% of the shares of UMSI, and (2) the closing deadline
is extended until January 31, 1999, unless further extended with the mutual
consent of the registrant and Unico.
In addition to the above-described consideration, the registrant has
agreed to extinguish certain debts of Unico up to $164,000, to assume certain
debts of Unico (principally a secured loan from BancFirst, an Oklahoma banking
corporation, in the principal amount not to exceed $450,000) and to provide
additional cash to Unico of approximately $210,000 in the form of working
capital loans that will be transferred by Unico to its subsidiary, UMSI, to be
used as working capital and will be forgiven upon consummation of the
Transaction. The cash consideration for the Transaction has been obtained by the
registrant, in part through the sale in a separate transaction of 70,000 shares
of redeemable, cumulative, preferred stock, par value $0.01 per share (the
"Series B Preferred Stock") together with 250,000 stock purchase warrants for
the purchase of one share of common stock each at an exercise price of $0.16 per
share and valid for five years from the date of issue to T.C. Equities Ltd., a
Bahamian investment company ("T.C. Equities"), in exchange for $350,000 in cash.
The sale of the Series B Preferred Stock was a private transaction under Section
3(b) of the Securities Act.
In exchange for the $350,000, the registrant has agreed to provide
additional consideration to T.C. Equities in the form of the Series C Preferred
stock and certain common stock (described below) of Unico acquired by the
registrant. These transactions would result in the transfer of all of the
registrant's interests in Unico to T.C. Equities and the acquisition of
effective control of Unico by T.C. Equities upon consummation of the
Transaction. On December 30, 1998, the registrant entered into amended and
restated agreements with T.C. Equities providing for an extension of time in
which to consummate the Transaction in addition to increasing the number of
shares of Unico common stock that the registrant will transfer to T.C. Equities.
The registrant obtained these additional shares of Unico common stock in
exchange for extinguishing a working capital loan from the registrant to Unico
of $180,000.
On December 30, 1998, the registrant entered into an amended and restated
shareholder agreement among the registrant, and certain shareholders of the
registrant whereby the shareholders have agreed, among other things, to vote
their shares in order to bring about certain changes in the registrant's
management. The Board of Directors has approved a resolution appointing Gerard
R. Bernier, currently the President and Chief Executive Officer ("CEO") of Unico
and UMSI, as President and CEO of the registrant and confirming Mr. Bernier as
President and CEO of UMSI upon consummation of the Transaction. The registrant
has appointed Mr. Bernier as a consultant pending consummation of the
Transaction.
As indicated above, the cash components of the foregoing transactions
were funded in part by the proceeds of the sale of the Series B Preferred Stock
and other consideration to T.C. Equities. The registrant hopes to engage in
other transactions
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which may include further sales of common stock and/or loans in order to obtain
sufficient funds to complete the Transaction. However, there can be no assurance
that the registrant will be able to engage in such transactions or obtain such
funds. If the registrant is unable to obtain sufficient additional funds, it
will be unable to complete the Transaction, the registrant will be in breach of
its contractual obligations to, among others, Unico, and the registrant's
business, financial condition and results of operations will be materially
adversely affected.
(b) The registrant will acquire from Unico as part of the Transaction,
all of the capital stock of UMSI. UMSI is engaged in cooperative direct mail
advertising through franchising and production. UMSI's business involves the
design, layout, printing, packaging and distributing of public relations,
marketing materials and promotional coupons for private businesses, usually
involved in retailing goods or providing professional services. Franchising
activities related to this business involve the granting and administering of
independent franchise operations to conduct cooperative direct mail advertising
sales. As of December 31, 1997, UMSI had approximately 65 active franchise
operations. UMSI operates its corporate headquarters and its coupon sales and
franchise activities through an office and production facility at 8380 Alban
Road, Springfield, VA 22150. UMSI had approximately 95 employees as of December
31, 1997. The registrant intends to continue such use of such property and
facilities.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION, AND EXHIBITS
(a) Financial Statements. The registrant shall provide the information
required by Item 310 (c) and (d) of Regulation S-B in lieu of the financial
information required by Item 7 of this Form, by amendment, within sixty days of
the date on which this Form 8-K must be filed.
(c) Exhibits.
Exhibit 2.1 Amended and Restated Stock Purchase Agreement and Plan of Merger
among Unico, UMSI, United Marketing Merger Corp. and the registrant
dated as of December 30, 1998.
Exhibit 2.2 Amended and Restated Stock Purchase and Shareholders Agreement
among Gerard R. Bernier, Joel P. Sens, Lawrence Grimes, Kenneth
Brochin, David Grossman, Jeffrey Sens and the registrant dated as
of December 30, 1998.
Exhibit 2.3 Amended and Restated Escrow Agreement among T.C. Equities Ltd., the
Law Office of Shane Henty Sutton, P.C. and the registrant dated as
of December 30, 1998.
Exhibit 2.4 Amended and Restated Stock Purchase Agreement between T.C. Equities
Ltd. and the registrant dated as of December 30, 1998.
Exhibit 2.5 Amended and Restated Securities Subscription Agreement between T.C.
Equities Ltd. and the registrant dated as of December 30, 1998.
Exhibit 2.6 Stock Purchase Agreement among T.C. Equities Ltd., Unico, Inc. and
the registrant dated as of December 30, 1998.
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Exhibit 4.1 Resolutions of the Board of Directors as of December 14, 1998
providing for the approval of the amended and restated transaction
documents, the appointment of Mr. Bernier as President and CEO and
other matters.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NEXT GENERATION MEDIA CORP.
(Registrant)
Date: January 7, 1999 /s/ Lawrence Grimes
----------------------
By: Lawrence Grimes
Title: President
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INDEX TO EXHIBITS
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Exhibit No. Description
Page
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2.1 Amended and Restated Stock Purchase Agreement and Plan of Merger
among Unico, UMSI, United Marketing Merger Corp. and the
registrant dated as of December 30, 1998.
2.2 Amended and Restated Stock Purchase and Shareholders Agreement
among Gerard R. Bernier, Joel P. Sens, Lawrence Grimes, Kenneth
Brochin, David Grossman, Jeffrey Sens and the registrant dated as
of December 30, 1998.
2.3 Amended and Restated Escrow Agreement among T.C. Equities Ltd.,
the Law Office of Shane Henty Sutton, P.C. and the registrant
dated as of December 30, 1998.
2.4 Amended and Restated Stock Purchase Agreement between T.C.
Equities Ltd. and the registrant dated as of December 30, 1998.
2.5 Amended and Restated Securities Subscription Agreement between
T.C. Equities Ltd. and the registrant dated as of December 30,
1998.
2.6 Stock Purchase Agreement among T.C. Equities Ltd., Unico, Inc. and
the registrant dated as of December 30, 1998.
4.1 Resolutions of the Board of Directors as of December 14, 1998
providing for the approval of the amended and restated transaction
documents, the appointment of Mr. Bernier as President and CEO and
other matters.
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EXHIBIT 2.1
AMENDED AND RESTATED
STOCK PURCHASE AGREEMENT AND
PLAN OF MERGER
UNICO INC.,
UNITED MARKETING SOLUTIONS INC.,
NEXT GENERATION MEDIA CORP. and
UNITED MARKETING MERGER CORP.
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AMENDED AND RESTATED
STOCK PURCHASE AGREEMENT
THIS AMENDED AND RESTATED STOCK PURCHASE AGREEMENT (the "Agreement") is
dated the 30th day of December, 1998, among UNICO, INC., a Delaware corporation
("Seller"), UNITED MARKETING SOLUTIONS INC., a Virginia corporation formerly
known as United Coupon Corporation ("UMSI"), NEXT GENERATION MEDIA CORP., a
Nevada corporation ("Buyer"), and UNITED MARKETING MERGER CORP., a Virginia
corporation ("Newco").
RECITALS
A. Seller owns 100% of the issued and outstanding shares of the
capital stock of UMSI.
B. Seller desires to sell, and Buyer desires to purchase, all of
Seller's shares of capital stock of UMSI, for the consideration
and upon the terms and subject to the conditions hereinafter set
forth.
C. The parties desire that Newco shall be merged with and into UMSI
(said transaction being hereinafter referred to as the "Merger")
pursuant to a plan of merger substantially in the form set forth
in Annex A hereto (the "Plan of Merger").
D. The parties desire to provide for certain undertakings,
conditions, representations, warranties and covenants in
connection with the transactions contemplated hereby.
E. The parties executed a Stock Purchase Agreement dated as of May 8,
1998 (the "Prior Agreement") and, since the date of the execution
of the Prior Agreement, certain events have occurred that have
rendered the Prior Agreement no longer reflective of the parties'
desired method of consummating the Merger.
F. In light of the changes in circumstances and the desire among the
parties to amend the Prior Agreement, the parties have executed
this Agreement to provide for a more rapid conclusion of the
transactions contemplated in the Prior Agreement and in this
Agreement.
NOW, THEREFORE, in consideration of the foregoing, and for other
consideration, the receipt and sufficiency of which are acknowledged, the
parties agree as follows:
1. Purchase and Sale of Stock and Merger.
1.1. Agreement to Purchase and Sell. Upon the terms and subject to the
conditions set forth in this Agreement, on the Closing Date (as defined below),
Seller shall sell to Buyer, and Buyer shall purchase from Seller, 1 share of
common stock (the "UMSI Shares"), par value $20.00, of UMSI ("UMSI Common")
representing 100% of the issued and outstanding capital stock of UMSI.
1.2. Purchase Price. In exchange for the UMSI Shares,
Buyer agrees to pay the Seller the purchase price in the form of (a) $172,664.50
in cash (the "Merger Consideration") which is equal to $0.10 multiplied by the
number of shares of Unico Common Stock, par value $0.01 per share ("Unico
Common") held by the holders of Unico Common ("Unico Common Holders") other than
either T.C. Equities Ltd. or Next Generation Media Corp., (b) forgiveness of
indebtedness in the amount of $175,500.00 owed by Seller to Buyer pursuant to
Section 6.15.1 hereof (the "Debt Forgiveness"), and (c) $164,000.00 cash (the
"Debt Pay-Off Consideration," and, together with the Merger Consideration and
the Debt Forgiveness, the "Purchase Price") for the
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payment of debts of Seller to the extent that creditors of Seller (other than
BancFirst, an Oklahoma banking corporation ("BancFirst")) do not consent to the
assignment of such debt by Seller, the assumption of such debt by Buyer and the
release of Seller in respect of such debt by such creditor.
1.3. Payment of Purchase Price. The Purchase Price shall be payable as
follows:
1.3.1. Buyer shall pay to the Seller the Merger Consideration upon
the Closing (as defined herein).
1.3.2. Buyer shall pay Seller the Debt Pay-Off Consideration at
Closing.
1.4. Closing. The closing of the purchase and sale of the UMSI Shares
(the "Closing") shall take place at the offices of Williams & Connolly,
Washington, D.C., as soon after the vote of the shareholders of Seller as is
practicable (such date, the "Closing Date").
1.5. Merger. UMSI and Newco are constituent corporations (the
"Constituent Corporations") to the Merger as contemplated by the Virginia Stock
Corporation Act, as amended (the "VSCA"). At the Effective Time (as defined
herein):
1.5.1. Newco shall be merged with and into UMSI in accordance with
the applicable provisions of the VSCA, with UMSI being the surviving corporate
entity (the "Surviving Corporation").
1.5.2. The separate existence of Newco shall cease, and the Merger
shall in all respects have the effect provided for in subsection 1.8.
1.5.3. The Articles of Incorporation of UMSI at the Effective Time
shall become the Articles of Incorporation of the Surviving Corporation.
1.5.4. The bylaws of UMSI at the Effective Time shall become the
bylaws of the Surviving Corporation.
1.6. Filing; Plan of Merger. The Merger shall not become effective
unless this Agreement and the Plan of Merger are duly adopted by the respective
boards of directors of the Constituent Corporations and approved by shareholders
holding the requisite number of shares of Seller and each of the Constituent
Corporations. Upon fulfillment or waiver of the conditions in Section 5 and
provided that this Agreement has not been terminated pursuant to Section 6.2,
the Constituent Corporations will cause the Plan of Merger to be certified,
executed, acknowledged and filed with the Virginia Corporation Commission as
provided in the VSCA. The Plan of Merger is incorporated herein by reference,
and adoption of this Agreement by the Boards of Directors of the Constituent
Corporations and approval by the shareholders of the Constituent Corporations
and of Seller shall constitute adoption and approval of the Plan of Merger.
1.7. Effective Time. The Merger shall be effective at the day and hour
specified in the Articles of Merger (including the Plan of Merger) filed with
the Virginia Corporation Commission (the "Effective Time").
1.8. Effect of Merger. From and after the Effective Time, the Merger
shall have the effect described in the VSCA. At the Effective Time, by virtue of
the Merger and without any action on the part of Constituent Corporations, each
share of the common stock of Newco issued and outstanding immediately prior to
the Effective Time shall no longer be issued and outstanding, and each share of
the UMSI Common issued and outstanding immediately prior to the Effective Time
shall continue to be issued and outstanding. The Surviving
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Corporation shall become, by virtue of the Merger and without any action on the
part of the Constituent Corporations, a wholly-owned subsidiary of Buyer.
2. Representations and Warranties of Seller and UMSI. Seller and UMSI each
represents and warrants to Buyer as follows:
2.1. Capital Structure, Organization, Standing and Authority. The
authorized capital stock of Seller consists of 20,000,000 shares of Unico
Common, par value $0.01 per share, and 5,000,000 shares of Preferred Stock, par
value $0.01 per share ("Unico Preferred") of which Seller has one designated
series (the "Unico Series C Preferred"). No other classes of capital stock of
Seller are authorized. As of the date hereof, 5,631,817 shares of Unico Common
and no other shares of capital stock of Seller are issued and outstanding. (The
428,185 shares of Unico Series C Preferred stock converted at a ratio of 1:4 to
common stock as of August 1, 1998.) All outstanding shares of Unico Common have
been duly authorized and are validly issued, fully paid and nonassessable.
Except as set forth on Schedule 2.1 of the Prior Agreement, Seller has no
warrants, options, rights, convertible securities and other arrangements or
commitments that obligate it to issue or dispose of any of its capital stock or
other ownership interests, and stock appreciation rights, performance units and
similar stock-based rights whether or not they obligate the issuer thereof to
issue stock, or other securities or to pay cash (collectively, "Rights")
authorized, issued or outstanding with respect to the capital stock of Seller.
Holders of Unico Common do not have preemptive rights. Seller is a corporation
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware with full corporate power and authority to carry on its
business in any other state of the United States or foreign jurisdiction where
such failure would have a material adverse effect on the financial condition,
results of operations, business or business prospects of Seller.
2.2. Authorization; Validity and Effect of Transaction Documents. The
execution and delivery of this Agreement and all other Transaction Documents (as
defined herein) by Seller, and the consummation by it of the transactions
contemplated hereby and thereby (the "Transactions"), have been duly authorized
by all requisite corporate action (subject to receipt of approval of the Unico
Common Holders of this Agreement and the Plan of Merger). This Agreement
constitutes, and all other agreements and documents contemplated hereby (the
"Transaction Documents"), which are to be executed and delivered by Seller, when
executed and delivered pursuant hereto, will constitute the valid and legally
binding obligations of Seller, enforceable in accordance with their respective
terms (subject to receipt of approval of the Seller's shareholders of this
Agreement and the Plan of Merger). The execution and delivery of this Agreement
and any other Transaction Document does not, and the consummation of the
Transactions will not: (i) require the consent of any third party (other than
the approval of the Seller's shareholders of this Agreement and the Plan of
Merger and the consent of BancFirst), (ii) violate any statute or law or any
rule, regulation, order, writ, injunction, arbitration award, or decree of any
court, administrative or governmental agency, instrumentality, commission,
authority, board or other body (a "Governmental Authority") or require any
authorization, consent, approval, exemption or other action by or notice to any
Governmental Authority; (iii) result in the breach of any term or provision of,
or constitute a default under, or result in the acceleration of or entitle any
party to accelerate (whether after the giving of notice or the lapse of time or
both) any obligation under, or result in the creation or imposition of any lien,
charge, pledge, security interest, encumbrance, assessment or adverse claim (a
"Lien") upon any part of the property of Seller pursuant to any provision of,
any material contract, indenture, mortgage, lease, license, Lien, or other
agreement or instrument to which Seller is a party or by which it is bound, or
(iv) violate or conflict with any provision of the bylaws or articles of
incorporation of the Seller as amended to the date of this Agreement.
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2.3. Ownership of Subsidiary. Seller's sole operating subsidiary is
UMSI, a Delaware corporation. The authorized capital stock of UMSI
consists of 100 shares of UMSI Common, par value $20.00 per share.
No other classes of capital stock of UMSI are authorized. As of
the date hereof, one share of UMSI Common is issued and
outstanding, and no other shares of capital stock of UMSI are
issued and outstanding. All outstanding shares of UMSI Common have
been duly authorized and are validly issued, fully paid and
nonassessable. No shares of capital stock have been reserved for
any purpose. UMSI has no Rights authorized, issued or outstanding
with respect to the capital stock of UMSI. Seller is the sole
holder of 100% of the issued and outstanding capital stock of
UMSI, free and clear of all Liens, encumbrances, charges,
defaults, pledges or equitable interests other than the Lien of
BancFirst. UMSI is a corporation duly incorporated, validly
existing and in good standing under the laws of the Commonwealth
of Virginia with full corporate power and authority to carry on
its business as it is currently being conducted in any other state
of the United States or foreign jurisdiction where such failure
would have a material adverse effect on the financial condition,
results of operations, business or business prospects of UMSI.
2.4. Authorization; Validity and Effect of Transaction Documents -
UMSI. The execution and delivery of this Agreement and all other Transaction
Documents by UMSI, and the consummation by it of the Transactions have been duly
authorized by all requisite corporate action. This Agreement and the Transaction
Documents which are to be executed and delivered by UMSI, when executed and
delivered pursuant hereto, will constitute the valid and legally binding
obligations of UMSI, enforceable in accordance with their respective terms
(subject to receipt of approval of the Unico Common Holders of this Agreement
and the Plan of Merger). The execution and delivery of this Agreement and any
other Transaction Document does not, and the consummation of the Transactions
will not: (i) require the consent of any third party (other than the approval of
Seller's shareholders of this Agreement and the Plan of Merger and the consent
of BancFirst), (ii) violate any statute or law or any rule, regulation, order,
writ, injunction, arbitration award, or decree of any Governmental Authority or
require any authorization, consent, approval, exemption or other action by or
notice to any Governmental Authority; (iii) result in the breach of any term or
provision of, or constitute a default under, or result in the acceleration of or
entitle any party to accelerate (whether after the giving of notice or the lapse
of time or both) any obligation under, or result in the creation or imposition
of any Lien upon any part of the property of UMSI pursuant to any provision of,
any material contract, indenture, mortgage, lease, license, Lien, or other
agreement or instrument to which UMSI is a party or by which it is bound, or
(iv) violate or conflict with any provision of the bylaws or articles of
incorporation of UMSI as amended to the date of this Agreement.
2.5. Assets and Contract Rights. Seller has no significant assets other
than the UMSI Shares and its contract rights pursuant to this Agreement and the
other Transaction Documents.
2.6. Litigation. Other than as provided in Schedule 2.6 of the Prior
Agreement as updated herewith, there are no actions, suits, investigations,
inquiries or other proceedings with respect to Seller or UMSI involving claims
by or against Seller or UMSI which are pending or threatened against any such
entity, at law or in equity, or before or by any federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality regarding Seller's ownership of the UMSI Shares, Seller's
business or UMSI's business.
2.7. Interested Party Transactions. No current or former officer,
director, or shareholder of Seller, or any family member of any such natural
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person: (a) is owed or will be owed any debt by UMSI, either directly or
indirectly; (b) is indebted or will be indebted to UMSI; or (c) is, directly or
indirectly, interested in any contract of UMSI or any other entity now owning or
which has owned in the past calendar year any assets of UMSI, other than Mr.
Gerard Bernier, in respect of whom UMSI has executed an employment agreement and
an indemnification in connection with a line of credit established for the
benefit of UMSI.
2.8. Securities Filings; Statements True.
2.8.1. Seller has timely filed all reports, proxy statements,
registration statements and all similar documents (the
"Securities Documents") filed, or required to be filed,
pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), the Securities Exchange Act of 1934, as
amended, the Investment Company Act of 1940, as amended,
the Trust Indenture Act of 1939, as amended, and the rules
and regulations of the Securities and Exchange Commission
(the "SEC") promulgated thereunder (collectively, the
"Securities Laws") since January 1, 1995, with the
exception of Seller's annual report on Form 10-K for fiscal
year 1997 that was filed with the SEC on April 16, 1998.
Seller has provided to Buyer a true and complete copy of
each Securities Document filed by Seller with the SEC that
Seller was required to file during such period. As of their
respective dates of filing, such Securities Documents
complied with the Securities Laws as then in effect, and
did not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of
the circumstances under which they were made, not
misleading.
2.8.2. The consolidated balance sheets of Seller as of December
31, 1997, 1996 and 1995, and the related consolidated statements of income,
shareholders' equity and cash flows (including related notes and schedules, if
any) for each of the three years ended December 31, 1997, 1996 and 1995, as
filed by Seller in Securities Documents and the consolidated balance sheets of
Seller (including related notes and schedules, if any) and the related
consolidated statements of income, changes in shareholders' equity and cash
flows (including related notes and schedules, if any) including in Securities
Documents filed by Seller with respect to periods ended subsequent to December
31, 1997 (collectively, the "Financial Statements") fairly present or will
fairly present, as the case may be, the consolidated financial position of
Seller and UMSI as of the dates indicated and the consolidated results of
operations, changes in shareholders' equity and statements of cash flows for the
periods then ended (subject, in the case of unaudited interim statements, to the
absence of notes and to normal year-end audit adjustments that are not material
in amount or effect) in conformity with U.S. generally accepted accounted
principles on a consistent basis.
2.8.3. No statement, certificate, instrument or other writing
furnished or to be furnished hereunder by Seller or UMSI contains or will
contain any untrue statement of material fact or will omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
2.9 Adverse Change. Since December 31, 1997, Seller and UMSI have not
incurred any liability except as disclosed in the most recent Seller Financial
Statements, or entered into any transactions with affiliates, in each case other
than in the ordinary course of business consistent with past practices, nor has
there been any adverse change or any event involving a prospective adverse
change in the business, financial condition or results of operations of
<PAGE> 7
Seller or of UMSI. All liabilities (including contingent liabilities) of Seller
and UMSI are disclosed in the most recent Financial Statements of Seller or were
incurred in the ordinary course of business since the date of Seller's most
recent Financial Statements.
2.10. Loans. All of the loans on the books of Seller and UMSI are valid
and properly documented, and were made in the ordinary course of business.
Neither the terms of such loans, nor any of the loan documentation, nor the
manner in which such loans have been administered and serviced, violates any
federal, state or local law, rule, regulation or ordinance applicable thereto.
Attached at Schedule 2.10 of the Prior Agreement is (a) a summary of all
outstanding material debt obligations of Seller including the name and address
of each creditor, the outstanding principal and interest owed as of the date
hereof and the material terms of such debt obligation, and (b) a copy of written
evidence from BancFirst that BancFirst will not object to the Transactions,
consents to the acquisition of UMSI by Buyer, releases Seller from its
obligations in regard to its debt to BancFirst and agrees to the assumption by
Buyer of such obligations in regard to the debt of Seller to BancFirst.
2.11. Taxes. Other than as described on Schedule 2.11 of the Prior
Agreement, Seller and UMSI have timely filed (or requests for extensions have
been timely filed and any such extensions have been granted and have not
expired) all federal, state and local (and, if applicable, foreign) tax returns
required by applicable law to be filed by them and have paid, or where payment
is not required to have been made, have set up an adequate reserve or accrual
for the payment of, all taxes required to be paid in respect of the period
covered by such returns and will have paid, or where payment is not required to
have been made, will have set up an adequate reserve or accrual for the payment
of, all taxes for any subsequent periods ending on or prior to the Closing Date.
Neither Seller nor UMSI will have any liability for any such taxes in excess of
the amounts so paid or reserves or accruals so established. All federal, state
and local (and, if applicable, foreign) tax returns filed by Seller and UMSI are
complete and accurate. Neither Seller nor UMSI is delinquent in the payment of
any tax, assessment or governmental charge.
2.12. Compliance with Laws. Each of Seller and UMSI is in compliance
with all statutes and regulations, and has obtained and maintained all permits,
licenses and registrations applicable to the conduct of its business, and
neither Seller nor UMSI has received notification (a) asserting a violation or
possible violation of any such statute or regulation, (b) threatening to revoke
any permit, license, registration or other government authorization, or (c)
restricting or in any way limiting its operations.
2.13. No Brokers. Neither Seller nor UMSI has entered into any contract,
arrangement or understanding with any person or firm which may result in the
obligation of Buyer, Seller or UMSI to pay any finder's fees, brokerage or
agent's commissions or other like payments in connection with the negotiations
leading to this Agreement and the other Transaction Documents or the
consummation of the Transactions, and Seller is not aware of any claim or basis
for any claim for payment of any finder's fees, brokerage or agent's commissions
or other like payments in connection with the negotiations leading to this
Agreement and the other Transaction Documents or the consummation of the
Transactions.
2.14. Certain Information. When the proxy statement is mailed, and at
the time of the meeting of Seller's shareholders to vote upon this Agreement and
the Plan of Merger, the proxy statement and all amendments and supplements
thereto, with respect to all information set forth therein provided by Seller,
(a) shall comply with the applicable provisions of the Securities Laws and (b)
shall not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
<PAGE> 8
contained therein, in light of the circumstances in which they were made, not
misleading.
2.15. Insurance. Set forth in Schedule 2.15 of the Prior Agreement is a
complete list of insurance policies that Seller maintains with respect to itself
and/or UMSI, together with a copy of the declarations page of each such policy
setting forth, with respect to each policy, the amount and type of coverage,
limits and deductibles, inception and expiration dates and insurance carrier.
Such policies are in full force and effect.
2.16 Employees. Set forth in Schedule 2.16 of the Prior Agreement is an
accurate and complete list of the names of all persons employed by UMSI
("Employees") as of its date, together with the following information with
respect to each Employee: base compensation and department. Except as set forth
in Schedule 2.16, neither Seller nor UMSI has promised or agreed to give any
Employee a pay raise or any additional compensation other than with respect to a
review in the ordinary course of business consistent with past practice.
Schedule 2.16 also sets forth the names of all Employees with whom Seller or
UMSI has entered into an employment agreement and/or a non-compete agreement, as
well as the material terms of any such agreement.
2.17 Employee Benefit Plans; ERISA Compliance. With respect to each
employee benefit plan, as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and every other fringe
benefit, stock option, bonus, incentive compensation, deferred compensation,
excess, supplemental executive compensation, employee stock purchase, vacation,
sickness or disability, severance or separation, restricted stock or other
employee benefit plan, policy or arrangement, whether written or oral,
maintained or contributed to within the last five years by UMSI or by a Common
Control Entity (as defined below) for the benefit of Employees or former
employees or under which UMSI has or may have any liability or obligation (the
"Benefit Plans") maintained by UMSI or any corporation or other trade or
business under common control with UMSI (as determined under Section 414(b) or
(c) of the Code, a "Common Control Entity"): (i) there is no actual or
contingent liability under Title IV of ERISA or the Code to any person or
entity, including the Pension Benefit Guaranty Corporation, the IRS, any such
plan or the participants (or their beneficiaries) in any such plan; (ii) the
assets of UMSI have not been subject to a lien under ERISA or the Code; and
(iii) there is no basis for such liability or the assertion of any such lien
with respect to the assets of UMSI as the result of or after the consummation of
the transactions contemplated by this Agreement. UMSI and each Common Control
Entity has at all times complied with the continuation of coverage requirements
of Section 601 through 609 of ERISA and Section 4980B of the Code ("COBRA"). No
Benefit Plan provides health, dental, life insurance or other welfare benefits
(whether on an insured or self-insured basis) to Employees or former employees
after their retirement or other termination of employment from UMSI (other than
continuation coverage required under COBRA which may be purchased at the sole
expense of the employee or former employee).
2.18. Employee Relations. For the past three years, neither Seller nor
UMSI has engaged in any unfair labor practice with respect to any Employees or
former employees; no unfair labor practice complaint has been brought or is
pending before the National Labor Relations Board with respect to any Employees
or former employees; there has been no labor strike, dispute, slowdown or
stoppage involving any Employees or former employees, nor is there any now
pending or threatened; no representation question has been raised or now exists
respecting Employees or former employees; neither Seller nor UMSI has been
notified of any material grievance, and no arbitration proceeding arising out of
or under any collective bargaining agreement has been brought or is pending with
respect to any Employees or former employees; and neither Seller nor UMSI has
been or is a party to any collective bargaining agreement.
<PAGE> 9
2.19. Suppliers. Except as set forth in Schedule 2.19, no supplier of
the Seller or UMSI has, in the six months prior to the date hereof, given
written notice to Seller or UMSI to cancel or otherwise terminate or reduce, or
given such notice orally or threatened to cancel, terminate or reduce, its
relationship with Seller or UMSI other than in the ordinary course of business
consistent with past experience.
2.20 Environmental Laws. Neither Seller nor USMI has received any
notification that: Hazardous Materials (as defined below) have been generated,
used, treated or stored at, or transported to or from, any real property used in
UMSI's business; Hazardous Materials have been released or disposed of on any
such property; or Seller or UMSI is not in compliance with applicable
Environmental Laws and the requirements of any permits issued under such
Environmental Laws with respect to any such property, nor have any of the
foregoing events occurred. There are no pending or threatened claims, suits,
demands, investigations, proceedings or other actions relating to any
Environmental Law with respect to any such property. For purposes of this
Agreement, "Environmental Laws" shall mean any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, permit, policy or order now in
effect and in each case as amended to date and any judicial or administrative
interpretation thereof relating to Hazardous Materials, environmental matters,
the protection of public health and safety from environmental or health concerns
or otherwise relating to environmental conditions; and "Hazardous Materials"
shall mean all hazardous substances, wastes, materials or constituents, solid
wastes, special wastes, toxic substances, pollutants, contaminants, petroleum or
petroleum derived substances or wastes, radioactive materials, urea
formaldehyde, polychlorinated biphenyls, radon gas and related materials,
including, without limitation, any such materials defined, listed, identified
under or described in any Environmental Laws.
2.21. No Misrepresentation or Omission. No representation or warranty by
Seller or UMSI in this Section 2 or in any other section of this Agreement, or
in any certificate or other document furnished or to be furnished by Seller or
UMSI pursuant hereto, contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact necessary to make
the statements contained therein, in light of the circumstances under which they
were made, not misleading.
2.22. Merger Consideration. Seller represents and warrants that it shall
use the Merger Consideration, after payment of any indebtedness not assigned to
and assumed by Buyer for which the creditor shall also release Seller from such
obligation, to pay a special dividend to the holders of its common stock,
provided, however, that Seller shall not pay any portion of such Merger
Consideration to T.C. Equities, Ltd. with respect to common stock of Seller held
by T.C. Equities, Ltd.
The representations and warranties of Seller and UMSI set forth above (other
than in Sections 2.1., 2.2., 2.3., 2.4. and 2.8.) shall survive the Closing for
a period of three years. The representations and warranties of Seller and UMSI
set forth in Sections 2.1., 2.2., 2.3., 2.4. and 2.8.), and the covenants of
Seller and UMSI set forth herein shall survive the Closing indefinitely.
3. Representations and Warranties of Buyer. Buyer and Newco each represents
and warrants to Seller as follows:
3.1. Capital Structure, Organization, Standing and Authority. The
authorized capital stock of Buyer consists of 50,000,000 shares of NexGen
Common, par value $0.01 per share, and 1,000,000 shares of preferred stock, par
value $0.001 per share ("NexGen Preferred") of which Buyer has designated two
series, the "Series A Preferred Stock" and the "Series B Preferred Stock." No
other classes of capital stock of Seller are authorized. As of the date hereof,
3,397,071 shares of NexGen Common, 250,000 shares of Series A Preferred Stock
and 70,000 shares of Series B Preferred Stock are issued and outstanding,
<PAGE> 10
and no other shares of capital stock of Buyer are issued and outstanding. All
outstanding shares of NexGen Common and NexGen Preferred have been duly
authorized and are validly issued, fully paid and nonassessable. Except as set
forth on Schedule 3.1 of the Prior Agreement, Buyer has no Rights authorized,
issued or outstanding with respect to the capital stock of Buyer other than
certain rights with regard to certain financing transactions relating to this
Agreement attached hereto as Schedule 3.1(A). Holders of NexGen Common do not
have preemptive rights. Buyer is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Nevada. Newco is a
corporation duly incorporated, validly existing and in good standing under the
laws of the Commonwealth of Virginia. Buyer owns all of the issued and
outstanding shares of capital stock of Newco.
3.2. Authorization; Validity and Effect of Transaction Documents. The
execution and delivery of this Agreement and all other Transaction Documents by
each of Buyer and Newco, and the consummation by it of the Transactions, have
been duly authorized by all requisite corporate action. This Agreement
constitutes, and all other Transaction Documents to be executed and delivered by
Buyer, when executed and delivered pursuant hereto, will constitute, the valid
and legally binding obligations of Buyer, enforceable in accordance with their
respective terms. The execution and delivery of this Agreement and the other
Transaction Documents does not, and the consummation of the Transactions will
not, (i) require the consent of any third party, (ii) violate any statute or law
or any rule, regulation, order, writ, injunction, arbitration award or decree of
any Governmental Authority or require any authorization, consent, approval,
exemption or other action by or notice to any Governmental Authority, (iii)
result in the breach of any term or provision of, or constitute a default under,
or result in the acceleration of or entitle any party to accelerate (whether
after the giving of notice or the lapse of time or both) any obligation under,
or result in the creation or imposition of any Lien upon any part of the
property of Buyer pursuant to any provision of, any material contract,
indenture, mortgage, lease, license, Lien, or other agreement or instrument to
which Buyer is a party or by which it is bound, or (iv) violate or conflict with
any provision of the bylaws or articles of incorporation of Buyer, as amended to
the date of this Agreement.
3.3 Investment Intent. Buyer is acquiring the UMSI Shares for Buyer's
own account for investment with no present intention of distributing or
reselling any such Shares with a view to any distribution within the meaning of
the Securities Act, and Buyer will not, directly or indirectly, voluntarily
offer, sell, pledge or otherwise dispose of (or solicit any offers to purchase
or otherwise acquire or take a pledge of) any UMSI Shares, except as
contemplated by the Pledge Agreement, unless (i) registered pursuant to the
provisions of the Securities Act or (ii) an exemption from registration is
available under the Securities Act.
3.4. Litigation. There are no actions, suits, investigations, inquiries
or other proceedings with respect to Buyer or Newco involving claims by or
against Buyer or Newco which are pending or threatened against any such entity,
at law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality
regarding Buyer's or Newco's business.
3.5 Securities Filings; Statements True.
3.5.1. Buyer has filed all Securities Documents filed, or required
to be filed, pursuant to the Securities Laws since February 6, 1997 with the
exception of a quarterly report to be filed for the second quarter of 1998 which
shall be filed together with its quarterly report for the third quarter of 1998
with the SEC prior to the Closing. Buyer has provided or will provide prior to
the Closing to Seller a true and complete copy of each Securities Document filed
by Buyer with the SEC that Buyer was required to file during such period. As of
their respective dates of filing, such Securities Documents
<PAGE> 11
complied with the Securities Laws as then in effect, and did not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
3.5.2. The consolidated balance sheet of Buyer as of December 31,
1997, and the related consolidated statements of income, shareholders' equity
and cash flows (including related notes and schedules, if any) for the year
ended December 31, 1997, as filed by Buyer in Securities Documents and the
consolidated balance sheets of Buyer (including related notes and schedules, if
any) and the related consolidated statements of income, changes in shareholders'
equity and cash flows (including related notes and schedules, if any) including
in Securities Documents filed by Buyer with respect to periods ended subsequent
to December 31, 1997 (collectively, the "Financial Statements") fairly present
or will fairly present, as the case may be, the consolidated financial position
of Buyer as of the dates indicated and the consolidated results of operations,
changes in shareholders' equity and statements of cash flows for the periods
then ended (subject, in the case of unaudited interim statements, to the absence
of notes and to normal year-end audit adjustments that are not material in
amount or effect) in conformity with U.S. generally accepted accounted
principles on a consistent basis.
3.5.3. No statement, certificate, instrument or other writing
furnished or to be furnished hereunder by Buyer contains or will contain any
untrue statement of material fact or will omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
3.6 Adverse Change. Since December 31, 1997, Buyer has not incurred
any liability except as disclosed in the most recent Buyer Financial Statements,
or entered into any transactions with affiliates, in each case other than in the
ordinary course of business consistent with past practices, nor has there been
any adverse change or any event involving a prospective adverse change in the
business, financial condition or results of operations of Buyer. All liabilities
(including contingent liabilities) of Buyer are disclosed in the most recent
Financial Statements of Buyer or were incurred in the ordinary course of
business since the date of Buyer's most recent Financial Statements.
3.7. Taxes. Buyer's sole operating subsidiary, Independent News Inc.
("INI"), has timely filed (or requests for extensions have been timely filed and
any such extensions have been granted and have not expired) all federal, state
and local (and, if applicable, foreign) tax returns required by applicable law
to be filed by it and has paid, or where payment is not required to have been
made, has set up an adequate reserve or accrual for the payment of, all taxes
required to be paid in respect of the period covered by such returns and will
have paid, or where payment is not required to have been made, will have set up
an adequate reserve or accrual for the payment of, all taxes for any subsequent
periods ending on or prior to the Closing Date. Buyer will not have any
liability for any such taxes or in excess of the amounts so paid or reserves or
accruals so established. All federal, state and local (and, if applicable,
foreign) tax returns filed by Buyer are complete and accurate. INI and, to the
best of Buyer's knowledge, Buyer are not delinquent in the payment of any tax,
assessment or governmental charge.
3.8. Compliance with Laws. Buyer is in compliance with all statutes and
regulations, and has obtained and maintained all permits, licenses and
registrations applicable to the conduct of its business, and Buyer has not
received notification (a) asserting a violation or possible violation of any
such statute or regulation, (b) threatening to revoke any permit, license,
registration or other government authorization, or (c) restricting or in any way
limiting its operations.
<PAGE> 12
3.9. No Brokers. Buyer has not entered into any contract, arrangement
or understanding with any person or firm which may result in the obligation of
Buyer, Seller or UMSI to pay any finder's fees, brokerage or agent's commissions
or other like payments in connection with the negotiations leading to this
Agreement and the other Transaction Documents or the consummation of the
Transactions, and Buyer is not aware of any claim or basis for any claim for
payment of any finder's fees, brokerage or agent's commissions or other like
payments in connection with the negotiations leading to this Agreement and the
other Transaction Documents or the consummation of the Transactions.
3.10. Certain Information. When the proxy statement is mailed to
Seller's shareholders, and at the time of the meeting of Seller's shareholders
to vote upon this Agreement and the Plan of Merger, the proxy statement and all
amendments and supplements thereto, with respect to all information set forth
therein provided by Buyer (a) shall comply with the applicable provisions of the
Securities Laws and (b) shall not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements contained therein, in light of the circumstances in which
they were made, not misleading.
3.11 Material Contracts. Set forth in Schedule 3.11 of the Prior
Agreement is a list of all material contracts entered into by Buyer since
February 6, 1997 other than those agreements and contracts listed on Schedule
3.1(A) hereto. Buyer has furnished to Seller copies of all material contract
listed on Schedule 3.11 of the Prior Agreement prior to the execution of this
Agreement.
a. INI Acquisition. All obligations of Buyer in connection
with its acquisition of the business of its subsidiary INI shall have been fully
performed and no conditions to such acquisition, either precedent or subsequent,
shall remain unsatisfied.
3.12. Employee Relations. Buyer has not engaged in any unfair labor
practice with respect to any Employees or former employees; no unfair labor
practice complaint has been brought or is pending before the National Labor
Relations Board with respect to any Employees or former employees; there has
been no labor strike, dispute, slowdown or stoppage involving any Employees or
former employees, nor is there any now pending or threatened; no representation
question has been raised or now exists respecting Employees or former employees;
Buyer has not been notified of any material grievance, and no arbitration
proceeding arising out of or under any collective bargaining agreement has been
brought or is pending with respect to any Employees or former employees; and
Buyer has not been or is not a party to any collective bargaining agreement.
3.14. Suppliers. No supplier of the Buyer has, in the six months prior
to the date hereof, given written notice to Buyer to cancel or otherwise
terminate or reduce, or given such notice orally or threatened to cancel,
terminate or reduce, its relationship with Buyer other than in the ordinary
course of business consistent with past experience.
3.15 Environmental Laws. Buyer has not received any notification that:
Hazardous Materials have been generated, used, treated or stored at, or
transported to or from, any real property used in Buyer's business; Hazardous
Materials have been released or disposed of on any such property; or Buyer is
not in compliance with applicable Environmental Laws and the requirements of any
permits issued under such Environmental Laws with respect to any such property,
nor have any of the foregoing events occurred. There are no pending or
threatened claims, suits, demands, investigations, proceedings or other actions
relating to any Environmental Law with respect to any such property.
3.16. No Misrepresentation or Omission. No representation or warranty by
Buyer in this Section 3 or in any other Section of this Agreement, or in any
<PAGE> 13
certificate or other document furnished or to be furnished by Buyer pursuant
hereto, contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact necessary to make the statements
contained therein, in light of the circumstances under which they were made, not
misleading.
The representations and warranties of Buyer and Newco set forth above (other
than in Sections 3.1., 3.2. and 3.5.) shall survive the Closing for a period of
three years. The representations and warranties of Buyer and Newco set forth in
Sections 3.1., 3.2., and 3.5.), and the covenants of Buyer and Newco set forth
herein shall survive the Closing indefinitely.
4. Other Covenants and Agreements.
4.1. Reserved.
4.2. Reserved.
4.3. Reserved.
4.4. Taxes and Expenses.
4.4.1. Seller covenants and agrees to pay any and all taxes on the
transfer to Buyer of the UMSI Shares. Except as otherwise specifically provided
for in this Agreement, Seller will assume and pay all costs, liabilities and
other obligations incurred by Seller in connection with the performance of and
compliance with all Transactions and other agreements and conditions contained
in this Agreement and the other Transaction Documents to be performed or
complied with by Seller, including legal and accounting fees. To the extent that
such costs, together with other cost, liabilities and other obligations of
Seller are not paid by Seller in the ordinary course and exceed the Debt Pay-Off
Consideration, such excess costs shall become an obligation of the Buyer.
4.4.2. Except as otherwise specifically provided for in this
Agreement, Buyer will assume and pay all costs, liabilities and other
obligations incurred by Buyer in connection with the performance of and
compliance with all Transactions and other agreements and conditions contained
in this Agreement and the other Transaction Documents to be performed or
complied with by Buyer, including legal and accounting fees.
4.5. Proprietary Information.
4.5.1. Seller covenants and represents that from and after the
Closing, Seller and its affiliates will not have any interest in, or claim to,
any patents, trademarks, trade names, service marks, copyrights or applications
therefor, or licenses to use any of the foregoing, or designs, methods,
inventories or know-how related thereto (collectively "Business Property
Rights") owned or held by UMSI, and all such Business Property Rights which are
necessary to, or used in the conduct of UMSI's business, and all knowledge or
information of a confidential nature acquired at or before the Closing Date with
respect to the UMSI and its business will be held in confidence by Seller and
will not be disclosed or made public, except for the benefit of Buyer or UMSI,
or made use of by or through Seller, directly or indirectly.
4.5.2. Seller, on its own behalf and on behalf of its affiliates,
acknowledges that a breach of subsection 4.5.1. hereof would cause irreparable
damage to Buyer, and in the event of Seller's actual or threatened breach of the
provisions of subsection 4.5.1. hereof, Buyer shall be entitled to a temporary
restraining order and an injunction restraining such Seller from breaching such
covenants without the necessity of posting bond or proving irreparable harm,
such being conclusively admitted by Seller. Nothing shall be
<PAGE> 14
construed as prohibiting Buyer from pursuing any other available remedies for
such breach or threatened breach, including the recovery of damages.
4.6. Operation of the Business. Except as contemplated herein or as
otherwise consented to by Buyer in writing, prior to the Closing Seller will,
and will cause UMSI to:
4.6.1. Use its best efforts to keep UMSI intact and not take or
permit to be taken or do or suffer to be done anything other than in the
ordinary course of the business of UMSI as presently conducted, including
without limitation incurring any contractual obligation outside the ordinary
course of the business as presently conducted, and to maintain the goodwill
associated with the business;
4.6.2. Not take any action that could result in the breach of any
of the representations, warranties or covenants of Seller or UMSI pursuant to
this Agreement, or that could cause any of the representations, warranties or
covenants of Seller or UMSI not to be true and correct in all material respects
immediately after such action or on the Closing Date; and
4.6.3. Recommend to the Unico Common Holders to vote in favor of
the Merger which will result in the sale of the UMSI Shares, Seller's sole
significant asset.
4.7. Access for Due Diligence Investigation. To the extent within
Seller's and Buyer's ability and control, each of the parties hereto have
afforded, and until the Closing, shall continue to afford, to the other parties
hereto and their respective representatives (including, without limitation,
directors, officers, employees, investment bankers, accountants, counsel, and
other advisors) full access during normal business hours to all of the assets,
books, and records of such party and such other information with regard to such
party as any other party hereto may from time to time request, and to make
copies of such books, records and other documents and to discuss the business of
such party with such persons (including, without limitation, directors,
officers, employees, accountants, counsel, suppliers, customers and creditors)
as each of the other parties hereto deems necessary or appropriate for making a
due diligence investigation of the other parties hereto. Buyer and Seller shall
coordinate contact with third parties concerning their due diligence
investigations.
4.8. Notification of Certain Events.
4.8.1. Each party shall give prompt notice to the other parties
hereto of (i) the occurrence, or failure to occur, of any event that could cause
any representation or warranty of such party contained in this Agreement to be
untrue or inaccurate at any time from the date hereof to the Closing Date or
which if known as of the date hereof would have been required to be disclosed to
the other parties hereto, and (ii) any failure of such party to comply with any
covenant, condition, or agreement to be complied with or satisfied by it under
this Agreement.
4.8.2. Each party shall give prompt notice to the other parties
hereto of any determination by it that an event described in clause 4.8.1.(i) or
(ii) could reasonably be expected to interfere with the Closing on the scheduled
Closing Date.
4.9. Permits and Consents. Seller and Buyer agree to cooperate and use
their best efforts to obtain any license, permit, authorization or approval (a
"Permit"), and to make any registration, declaration, or filing, required to be
obtained or made with any Governmental Authority or any other person or entity,
to consummate the Transactions. This covenant shall survive the Closing.
<PAGE> 15
4.10. UCC and Lien Searches. Buyer shall, at its sole cost and expense,
obtain copies of written reports of UCC and judgment lien searches in each
jurisdiction in which Seller or UMSI is organized or in which assets thereof are
located, such reports to be dated within ten days of the Closing Date. Seller
and UMSI represent and warrant that all of the assets of Seller and UMSI are
located in Fairfax County, Virginia.
4.11. Seller Shareholder Meeting; Proxy Statement. As promptly as
practicable after the date hereof, Seller shall prepare and file a proxy
statement with the SEC. Buyer will furnish to Seller upon request the
information required to be included in the proxy statement with respect to the
business and affairs of Buyer before it is filed with the SEC. Seller and Buyer
shall use their best efforts in responding to any inquiries concerning the proxy
statement from the SEC prior to mailing such proxy statement to the Seller's
shareholders. Seller shall cause the proxy statement to be mailed to and call
for a vote of its shareholders of record in accordance with all applicable
notice requirements under the Securities Laws and the Delaware General
Corporation Law.
5. Conditions of Closing.
5.1 Buyer's and Seller's Conditions of Closing. The obligation of
Buyer to purchase and pay for the UMSI Shares, and the obligation of Seller to
sell the UMSI Shares shall be subject to and conditioned upon the satisfaction
at the Closing of each of the following conditions:
5.1.1. Any and all Permits from third parties and Governmental
Authorities required to consummate the Transactions shall have been obtained.
5.1.2. No suit, action, investigation, inquiry or other legal or
administrative proceeding by any Governmental Authority or other person shall
have been instituted or threatened which questions the validity or legality of
the Transactions or which could reasonably be expected to adversely affect the
ability of Buyer to consummate such Transactions.
5.1.3. As of the Closing, there shall be no effective injunction,
writ, preliminary restraining order or any order of any nature issued by a court
of competent jurisdiction directing that the Transactions or any of them not be
consummated as so provided, or imposing any material conditions on the
consummation of such Transactions by Seller or Buyer.
5.1.4. The parties hereto shall have executed and delivered to the
other parties hereto all other Transaction Documents and shall have received and
delivered to the other parties the following documents:
a. Written evidence by Buyer of the consummation of its
acquisition of 100% of the subordinated debt of Seller and the Unico Series C
Preferred, and contemporaneous cancellation of the subordinated debt of Seller
to Buyer and waiver of all rights of the Unico Series C Preferred other than
voting and conversion rights;
b. Written evidence from BancFirst that BancFirst will
not object to the Transactions, consents to the acquisition of UMSI by Buyer,
releases Seller from its obligations in regard to its debt to BancFirst and
agrees to the assumption by Buyer of such obligations in regard to the debt of
Seller to BancFirst;
c. A stock purchase and shareholder agreement between
Messrs. Joel Sens ("Sens") and Gerard Bernier ("Bernier") providing for, among
other things, an agreement between Sens and Bernier concerning the structure of
Buyer's board of directors upon consummation of the Transactions;
<PAGE> 16
d. Employment agreements between Bernier and each of
Buyer and the Surviving Corporation for the appointment of Bernier as CEO of
each such corporation;
e. A consulting agreement between Buyer and Sens
providing for the engagement of Sens as a consultant to Buyer;
f. Stock option agreements between Buyer and each of
Sens and Kenneth Brochin ("Brochin") providing for 150,000 stock options,
exercisable at $0.50 per share for a term of ten years from the date of their
issuance to acquire one share per option of NexGen Common, for each of Sens and
Brochin;
g. A stock purchase agreement among Buyer, Bernier,
Gerald Bomstad ("Bomstad") and Leon Zajdel ("Zajdel") providing for the exchange
of Unico Common of each of Bernier, Bomstad and Zajdel for shares of NexGen
Common;
h. The cancellation of certain indebtedness of the
Buyer to certain shareholders of Buyer, and the cancellation of certain
indebtedness of certain shareholders of Buyer to Buyer;
i. Evidence of the reservation of 150,000 shares of
NexGen Common by Buyer's board of directors for awards to key employees of Buyer
and/or UMSI by Buyer's board of directors; and
j. Evidence of a restructuring of Buyer's loan from
KeyBank National Association to extend repayment past January 1, 2000, and Buyer
shall undertake its best efforts to reduce substantially the debt prior to
maturity.
5.1.5. The shareholders of Seller shall have approved the
Transactions through a shareholder vote.
5.2. Buyer's Conditions of Closing. The obligation of Buyer to purchase
and pay for the UMSI Shares shall be subject to and conditioned upon the
satisfaction at the Closing of each of the following conditions:
5.2.1. All representations and warranties of Seller and UMSI
contained in this Agreement and the other Transaction Documents shall be true
and correct at and as of the Closing Date, Seller shall have performed all
agreements and covenants and satisfied all conditions on its part required to be
performed or satisfied by the Closing Date pursuant to the terms of this
Agreement, and Buyer shall have received a certificate of the Seller dated the
Closing Date to such effect.
5.2.2. Seller shall have delivered to Buyer certificates of each
of Seller's and UMSI's corporate Secretary certifying:
(i) Resolutions of its Board of Directors authorizing
execution and delivery of this Agreement and the other Transaction
Documents and the performance of all Transactions; and
(ii) The incumbency of its officers executing this
Agreement and all other Transaction Documents executed on Seller's
behalf.
5.2.3. Seller shall have delivered to Buyer certificates of the
Secretary of State of Delaware and the Virginia Corporation Commission
certifying as of a date reasonably close to the Closing Date that each of Seller
and UMSI, respectively, has filed all required reports, paid all required fees
and taxes, and is, as of such date, in good standing and authorized to transact
business as a domestic corporation.
<PAGE> 17
5.2.4. Seller shall have delivered the stock and minute book of
UMSI and the written resignations, effective on the Closing Date, of all members
of the Board of Directors and all officers of UMSI, and shall have caused all
persons who have been designated by Buyer to be duly elected as directors and
officers of UMSI.
5.2.5. Seller shall have delivered to Buyer certificates and other
instruments representing all the UMSI Shares issued and outstanding, duly
endorsed for transfer or accompanied by appropriate stock powers (in either case
executed in blank or in favor of Buyer), together with all other documents
necessary or appropriate to validly transfer the UMSI Shares to Buyer free and
clear of all Liens.
5.2.6. There shall not have occurred any material adverse change
in the business, client relations, operations, properties, prospects, assets or
condition of UMSI, and no event shall have occurred or circumstance shall exist
that has specific application to UMSI (other than general economic or industry
conditions) that could reasonably be expected to result in such a material
adverse change.
5.3. Seller's Conditions of Closing. The obligation of Seller to sell
the UMSI Shares shall be subject to and conditioned upon the satisfaction at the
Closing of each of the following conditions:
5.3.1. All representations and warranties of Buyer contained in
this Agreement and the other Transaction Documents shall be true and correct at
and as of the Closing Date, Buyer shall have performed all agreements and
covenants and satisfied all conditions on its part required to be performed or
satisfied by the Closing Date pursuant to the terms of this Agreement, and
Seller shall have received a certificate of Buyer dated the Closing Date to such
effect.
5.3.2. Buyer shall have delivered to Seller a certificate of its
corporate Secretary certifying:
(i) Resolutions of its Board of Directors authorizing
execution of this Agreement and the execution, performance and delivery
of all agreements, documents and transactions contemplated hereby; and
(ii) The incumbency of its officers executing this
Agreement and all agreements and documents contemplated hereby.
5.3.3. Buyer shall have delivered the Merger Consideration and the
Debt Pay-Off Consideration as provided for in Section 1.2 herein on the Closing
Date, together with satisfactory evidence of the Debt Forgiveness as provided
for in Section 1.2 herein, collectively constituting the Purchase Price.
5.3.4. Buyer shall have adopted bylaws in the form attached hereto
as Exhibit 5.3.4.
5.3.5. Buyer shall, as soon as practical after the date hereof but
no later than December 31, 1998, enter into a stock purchase agreement, in
satisfaction of Seller's indebtedness to Buyer, and Seller shall issue 1,800,000
shares of UNICO Common to T.C. Equities, Ltd. in satisfaction thereof.
5.3.6. Seller, Seller's associates and NexGen, as those parties
are defined in that certain Amended and Restated Stock Purchase and Shareholder
Agreement of even date herewith, shall have fully performed each and all of
their obligations set forth in such agreement including, but not limited to,
performance of those specific items set forth in Exhibit C thereto.
<PAGE> 18
6. Miscellaneous.
6.1. Notice. Any notice or other communication required or permitted
hereunder shall be in writing and personally delivered, mailed by registered or
certified mail (return receipt requested and postage prepaid), sent by telegram
(with messenger service specified), sent by telecopier (with a confirming copy
sent by regular mail), or sent by prepaid overnight courier service, and
addressed to the relevant party at its address set forth below, or at such other
address as such party may, by written notice, designate as its address for
purposes of notice hereunder.
(a) If to Buyer, at:
Next Generation Media Corp.
900 North Stafford, Suite 2003
Arlington, VA 22203
Telecopy: (703) 516-9888
With a copy (which shall not constitute
notice) to:
Jonathan P. Graham, Esq.
Williams & Connolly
725 12th Street, N.W.
Washington, D.C. 20005
Telecopy: (202) 434-5029
(b) If to Seller, at:
UNICO, Inc.
8380 Alban Road
Springfield, VA 22150
Telecopy: (703) 913-0425
With a copy (which shall not constitute
notice) to:
Matthew A. Clary III, Esq.
Holland & Knight LLP
3110 Fairfax Park Drive, Suite 900
Falls Church, VA 22042
Telecopy: (703) 645-8610
Notice shall be effective immediately upon personal delivery or telecopy, seven
(7) business days after deposit in the mail, or one (1) business day after
deposit with a telegraph company or overnight courier service.
6.2. Termination.
6.2.1. Right of Termination Without Breach. This Agreement may be
terminated without further liability of any party at any time prior to the
Closing by mutual written agreement of the parties. Without the mutual written
agreement of the parties hereto, this Agreement will terminate on January 31,
1999.
6.2.2. Termination for Breach.
(i) Termination By Buyer. If there has been a material
breach by Seller or UMSI of any of Seller's or UMSI's agreements,
representations or warranties contained in this Agreement which has not been
waived in writing by Buyer, then Buyer may, by written notice to Seller at any
time prior to the Closing that such breach is continuing, terminate this
Agreement with the effect set forth in Section 6.2.2. (iii) hereof.
<PAGE> 19
(ii) Termination By Seller. If there has been a material
breach by Buyer of any of Buyer's agreements, representations or warranties
contained in this Agreement which has not been waived in writing by Seller, then
Seller may, by written notice to Buyer at any time prior to the Closing that
such breach is continuing, terminate this Agreement with the effect set forth in
Section 6.2.2. (iii).
(iii) Effect of Termination. Termination of this Agreement
pursuant to this Section 6.2.2. shall not in any way terminate, limit or
restrict the rights and remedies of any party hereto against any other party
which has breached or failed to perform any of the representations, warranties,
covenants, or agreements of this Agreement prior to termination hereof.
6.3 Disclosures and Announcements. Both the timing and the content of
all disclosures to third parties (other than disclosures to agents acting on
behalf of Buyer or Seller for purposes of conducting their respective due
diligence investigation) and public announcements concerning the transactions
provided for in this Agreement by either Seller or Buyer shall be subject to the
approval of the other in all essential respects until the Closing following
which the specific terms of the Transaction Documents shall remain confidential
between the parties, except to the extent that disclosure of such terms is
required under applicable laws or regulations.
6.4. Further Assurances. Each party will do such acts, and execute and
deliver to any other party such additional documents or instruments as may be
reasonably requested in order to effect the purpose of this Agreement and the
other Transaction Documents and to better assure and confirm unto the requesting
party its rights, powers and remedies hereunder and thereunder.
6.5. Binding Effect; No Assignment. This Agreement and the other
Transaction Documents shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Notwithstanding the
foregoing, no party shall assign any of its rights or delegate any of its
obligations under any Transaction Document without the prior written consent of
the other parties thereto, which may be withheld at their respective discretion.
6.6. Entire Agreement. This Agreement and the other Transaction
Documents constitute the full and entire understanding and agreement among the
parties with regard to their respective subject matters and supersede any and
all prior written or oral agreements, understandings, representations and
warranties made with respect thereto. No amendment, supplement or modification
of this Agreement or any other Transaction Document nor any waiver of any
provision hereof or thereof shall be made except in writing executed by all
parties hereto or thereto.
6.7. Governing Law. THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF VIRGINIA, WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF
CONFLICTS OF LAWS. Each of the parties hereto (a) agrees that any legal suit,
action or proceeding arising out of or relating to this Agreement will be
instituted exclusively in the state courts of Virginia or in the United States
District Court for the Eastern District of Virginia, (b) waives any objection
which such party may have now or hereafter to the venue of any such suit, action
or proceeding, and (c) irrevocably consents to the jurisdiction of the state
courts of Virginia and the United States District Court for the Eastern District
of Virginia in any such suit, action or proceeding. Each party further agrees to
accept and acknowledge service of any and all process which may be served in any
such suit, action or proceeding in such courts and agrees that service of
process upon such party mailed by certified mail to the party's address
specified pursuant to Section 6.1 will be deemed in every respect
<PAGE> 20
effective service of process upon such party in any such suit, action or
proceeding.
6.8. Survival. All representations, warranties, covenants and
agreements made by the parties to this Agreement and the other Transaction
Documents shall survive the execution of this Agreement and the Closing.
Notwithstanding any investigation conducted before the date of this Agreement or
the Closing, or the decision of any party to execute this Agreement or proceed
to Closing, each party shall be entitled to rely on the representations and
warranties of the other party set forth herein or in any other Transaction
Document.
6.9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.
6.10. Interpretation. No provision of this Agreement or any other
Transaction Document shall be interpreted or construed against any party because
that party or its legal representative drafted such provision. The titles of the
paragraphs of this Agreement and other Transaction Documents are for convenience
of reference only and are not to be considered in construing this Agreement or
the relevant Transaction Document. For all purposes of this Agreement and the
other Transaction Documents, unless the context otherwise requires or as
otherwise expressly provided, (a) all defined terms shall include both the
singular and the plural forms thereof; (b) reference to any gender shall include
all other genders; (c) all references to words such as "herein", "hereof", and
the like shall refer to this Agreement as a whole and not to any particular
Article or Section within this Agreement; (d) the term "include" means "include
without limitation"; and (e) the term "or" is intended to include the term
"and/or".
6.11. No Waiver; Remedies Cumulative. No waiver by any party hereto of
any one or more defaults by any other party or parties in the performance of any
of the provisions of this Agreement shall operate or be construed as a waiver of
any future default or defaults, whether of a like or different nature. No
failure or delay on the part of any party in exercising any right, power or
remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
The remedies provided for herein are cumulative and are not exclusive of any
remedies that may be available to any party hereto at law, in equity or
otherwise.
6.12. Incorporation of Exhibits. All exhibits and schedules attached
hereto are by this reference incorporated herein and made a part hereof for all
purposes as if fully set forth herein.
6.13. Severability. If any term, covenant or condition of this
Agreement, or the application of such term, covenant or condition to any party
or circumstance shall be found by a court of competent jurisdiction to be, to
any extent, invalid or unenforceable, the remainder of this Agreement and the
application of such term, covenant, or condition to parties or circumstances
other than those as to which it is held invalid or unenforceable, shall not be
affected thereby, and each term, covenant or condition shall be valid and
enforced to the fullest extent permitted by law. Upon determination that any
such term is invalid, illegal or unenforceable, the parties hereto shall amend
this Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner.
6.14. Stand Still. Except with the written consent of both Buyer and
Seller, each of the parties hereto, covenants that between the date hereof and
the Effective Time, other than as provided for in the Transaction Documents,
neither it nor any of its subsidiaries shall:
<PAGE> 21
a. carry on its business other than in the usual, regular and
ordinary course in substantially the same manner as heretofore conducted, or
establish or acquire any new subsidiary or engage in any new activity;
b. declare, set aside, make or pay any dividend or other
distribution in respect of its capital stock;
c. issue any shares of its capital stock;
d. issue, grant or authorize any Rights or effect any
recapitalization, reclassification, stock dividend, stock split or like change
in capitalization;
e. amend its articles of incorporation or bylaws; impose or
permit imposition of any lien, charge or encumbrance on any share of stock held
by it in any subsidiary, or permit such lien, charge or encumbrance to exist; or
waive or release any material right or cancel or compromise any debt or claim,
in each case other than in the ordinary course of business;
f. merge with any other entity or permit any other entity to
merge into it, or consolidate with any other entity; acquire control over any
other entity; or liquidate, sell or otherwise dispose of any assets or acquire
any assets, other than in the ordinary course of its business consistent with
past practices;
g. fail to comply in any material respect with any laws,
regulations, ordinances or governmental actions applicable to it and to the
conduct of its business;
h. increase the rate of compensation of any of its directors,
officers or employees, or pay or agree to pay any bonus to, or provide any other
employee benefit or incentive to, any of its directors, officers or employees;
i. enter into any material agreement, arrangement or
commitment not made in the ordinary course of business;
j. dispose of any material assets other than in the ordinary
course of business; or
k. agree to do any of the foregoing.
6.15 Execution Date.
6.15.1 Seller acknowledges that, pursuant to the Prior Agreement,
Buyer has made advances to Seller in the amount of $175,500
for working capital, payment of creditors and other
purposes. Seller and Buyer agree that on the Closing Date,
Buyer shall forgive this indebtedness to Seller and such
forgiveness of indebtedness shall be included in the
Purchase Price.
6.15.2 Seller acknowledges that, in addition to the advances made
pursuant to Section 6.15.1 hereof, Buyer has made advances
to Seller in the amount of $170,000 for working capital,
payment of creditors and other purposes since the execution
of the Prior Agreement. Seller shall enter into a stock
purchase agreement as soon as practical after the date
hereof and on or before December 31, 1998, whereby, in
satisfaction of this obligation to Buyer and in
consideration of Buyer's obligation to make certain other
advances to Seller on or before December 31, 1998, Seller
<PAGE> 22
shall sell 1,800,000 shares of Unico Common to T.C.
Equities, Ltd.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE.]
<PAGE> 23
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered as of the date first set forth above.
NEXT GENERATION MEDIA
CORP. (BUYER)
By: /s/ Larry Grimes
---------------------------
Lawrence Grimes
President
UNITED MARKETING MERGER
CORP. (NEWCO)
By: /s/ Larry Grimes
---------------------------
Lawrence Grimes
President
UNICO, INC. (SELLER)
By: /s/ Shane H. Sutton
---------------------------
Shane H. Sutton
President
UNITED MARKETING SOLUTIONS INC.
(UMSI)
By: /s/ Gerard Bernier
---------------------------
Gerard Bernier
President
<PAGE> 1
EXHIBIT 2.2
AMENDED AND RESTATED
STOCK PURCHASE AND SHAREHOLDERS AGREEMENT
THIS AMENDED AND RESTATED STOCK PURCHASE AND SHAREHOLDERS AGREEMENT (the
"Agreement"), entered into as of the 30th day of December, 1998, by and among
Gerard R. Bernier (the "Purchaser"), Joel P. Sens (the "Seller") and Lawrence
Grimes, Kenneth Brochin, David Grossman and Jeffrey Sens (collectively referred
to as the "Seller's Associates") and Next Generation Media Corp., a Nevada
corporation ("NexGen").
WITNESSETH:
WHEREAS, the parties hereto executed a Stock Purchase and Shareholders
Agreement dated as of May 12, 1998 (the "Prior Agreement"); and
WHEREAS, Seller was at the time of the Prior Agreement the majority and
controlling stockholder; and
WHEREAS, Seller's Associates are also stockholder's in or Officers or
Directors of NexGen; and
WHEREAS, NexGen is entering into an amended and restated definitive
agreement to acquire United Marketing Solutions, Inc., a Virginia corporation
(referred to herein as "United" and the "United Acquisition"), whose current
President and Chief Executive Officer is the Purchaser; and
WHEREAS, Seller and Seller's Associates are desirous of inducing
Purchaser, in connection with the United Acquisition, to continue as the
President and Chief Executive Officer of United and to assume the office of
director and Chief Executive Officer of NexGen and for such purposes are
desirous of entering into this agreement; and
WHEREAS, Seller owned, of record and beneficially, 2,045,929 shares of
the issued and outstanding shares of common stock, par value $0.01 per share, of
NexGen ("NexGen Common"), representing Sixty-Four and 9/10ths percent (64.9%) of
the issued and outstanding shares of common stock (computed on a fully diluted
basis) as of the date of the Prior Agreement; and
WHEREAS, the parties hereto wish to amend and restate that Prior
Agreement to take into account certain changes in the proposed United
Acquisition transaction that affect Seller, Purchaser and NexGen.
NOW THEREFORE, in consideration of the mutual promises and
representations herein set forth and for other good and valuable consideration,
the parties agree as follows:
1. Sale and Transfer of Shares: Upon and subject to the terms and conditions set
forth in this Agreement and the Prior Agreement, Seller has sold to Purchaser
Nine Hundred Thirty-Five Thousand (935,000) shares of NexGen Common owned by
Seller (the "Shares").
2. Purchase Price: Subject to the terms and conditions of the Prior Agreement
and this Agreement, in reliance upon the representations, warranties and
agreements of Seller and Seller's Associates contained herein, and in
consideration of the aforesaid sale, assignment and delivery of the Shares,
Purchaser has paid to Seller the amount of One Hundred Fifty-Six Thousand,
One Hundred Forty-Five and No/100 Dollars ($156,145) (the "Purchase Price")
in the form of a Non-Recourse Secured Promissory Note, payable in twenty-four
(24) equal installments of principal and interest (the "Purchaser's Note").
The Purchaser's Note bears interest at the rate of 5.83% per annum. Since the
execution of the
<PAGE> 2
Prior Agreement, the Purchaser's Note was transferred by Seller to NexGen in
satisfaction of $156,145 of that certain note from Seller to NexGen in the
principal amount of $359,050 ("Seller's Note") that is secured by certain of
Seller's common stock in NexGen, including the Shares.
3. Closing: The purchase and sale of the Shares (the "Closing") took place
pursuant to the Prior Agreement. Prior to the Closing, Seller's Associates,
as directors of NexGen, caused the NexGen approval recited in paragraph
13(b)(4) hereof to have been obtained to consummate the transactions
contemplated in the Prior Agreement and in this Agreement. At Closing, Seller
delivered to Purchaser all certificates representing the Shares, properly
endorsed or accompanied by stock powers duly executed in blank for transfer
on the books of NexGen.
4. Resignations and Management Participation Upon Closing: Upon Closing, Seller
delivered to Purchaser a written resignation of Seller as a director and
Officer of NexGen. Seller further represents and warrants that, upon Closing,
he relinquished all rights, in any capacity whatsoever, to participate in the
management, operation, conduct or control of NexGen and its subsidiaries'
day-to-day operations, without the specific authorization of Purchaser.
5. Appointment and Election of Purchaser as Director and President: Upon the
effective date of the United Acquisition (the "United Closing Date"), Seller,
Seller's Associates shall cause Purchaser to be elected as a director of
NexGen and appointed as NexGen's President and Chief Executive Officer
("CEO"). As compensation for agreeing to assume the office of NexGen's
President and Chief Executive Officer, Seller's Associates have caused NexGen
to issue Purchaser options to purchase 150,000 shares of NexGen common stock
at an exercise price of $.50 per share valid for ten years from the date of
issue. Seller's and Seller's Associates' agreements to cause Purchaser to be
appointed or elected as a director and CEO of NexGen, as set forth in this
paragraph 5, shall continue in full force and effect so long as Purchaser is
employed by or engaged as a consultant of NexGen or United.
6. Purchaser as Consultant: To facilitate an efficient implementation of the
NexGen/United business plan, Seller's Associates have caused Purchaser to be
appointed a consultant to NexGen contemporaneous with the execution of the
Prior Agreement until the United Closing Date. As compensation for and to
induce Purchaser to accept such appointment as consultant, Seller's
Associates shall cause NexGen to cancel and forgive the Purchaser's Note as
of the date of this Agreement and to pay to Purchaser, compensation in an
amount equal to the income tax obligations incurred by Purchaser as a
consequence of the aforesaid cancellation and forgiveness of Purchaser's Note
prior to the date such tax obligation becomes due. The parties confirm as
correct the method utilized by NexGen's independent auditors to compute such
tax obligations as set forth in Exhibit B hereto. As such consultant,
Purchaser shall oversee the prompt implementation of all preparatory actions
contemplated in the NexGen/United business plan approved by the NexGen Board
of Directors.
7. Appointment and Election of Additional Directors; Insurance: In addition to
the provisions of Paragraph 5 hereof, the parties hereto agree that the
NexGen Board of Directors shall have five seats, one of which became vacant
because of the resignation of Seller. Seller's Associates shall (i) cause
three additional directors from among the Seller's Associates to resign by
the United Closing Date; (ii) appoint and elect two designees of Purchaser as
directors by the United Closing Date; (iii) cause a designee of the holders
of the NexGen Series A Preferred Stock to be appointed and elected as a
director (the "Series A Director") prior to the United Closing Date; and (iv)
appoint and elect a person mutually selected by the holders of the NexGen
Series A Preferred Stock and Purchaser as an
<PAGE> 3
independent director, initially identified hereby as Mr. Steven Kronzek (the
"Independent Director") by the United Closing Date. As and when the Series A
Preferred Stock is redeemed or converted to NexGen common stock and the
rights of the holders thereof to nominate and elect the Series A Director
have been terminated, the parties agree (i) to seek the resignation of the
Series A Director and the Independent Director; (ii) to appoint and elect a
designee of Seller as a director to fill the vacancy created by the
resignation of the Series A Director; and (iii) to then mutually select an
agreed upon independent director to replace the Independent Director. In
addition, Purchaser and Seller agree to cause NexGen to obtain directors' and
officers' insurance no later than as and when the common stock of NexGen is
listed on any stock exchange. The parties' agreements, as set forth in this
paragraph 7, shall continue in full force and effect so long as Purchaser is
employed by NexGen or United. The parties hereto agree to vote their shares
of stock in NexGen, if necessary, at any shareholder meeting in order to
effectuate the purposes of this paragraph 7.
8. Cancellation of Debt: Pursuant to the Prior Agreement, Seller and Seller's
Associates agreed to the following cancellations of indebtedness between each
of Seller and Seller's Associates and NexGen:
(a) Seller owed $202,905 plus accrued interest on the Seller's
Note upon transfer of the Shares to Purchaser. NexGen owed
Seller $37,198.91 in working capital advanced by Seller.
Seller and NexGen netted these obligations in the amount of
$15,000, resulting in outstanding debts of $187,905 owed by
Seller to NexGen and $22,198.91 owed by NexGen to Seller.
In satisfaction of NexGen's debt to Seller, Seller accepted
NexGen common stock in lieu of payment at a sale price of
$0.334 per share, resulting in the issuance (rounded to the
nearest whole share) of 66,464 shares of NexGen common
stock to Seller. NexGen, in recognition of Seller's
contribution to the business forgave $152,905 of Seller's
debt to NexGen and shall pay to Seller as a special bonus,
cash in an amount sufficient for Seller to pay income tax
due on this cancellation of indebtedness prior to the date
such obligation become due. Seller then owed NexGen $35,000
remaining on Seller's Note.
(b) NexGen owed Kenneth Brochin, one of Seller's Associates
("Brochin"), $35,000 in working capital advanced by
Brochin. Brochin agreed to and has accepted, in payment of
NexGen's debt to him, transfer of the remaining balance of
Seller's Note in the amount of $35,000.
(c) NexGen owed Lawrence Grimes, one of Seller's Associates,
and W.B. Grimes & Co. (collectively, "Grimes"), $6,255 in
working capital and $17,500 in commissions, respectively.
Grimes agreed to and has released NexGen from such
obligations which such obligations Seller agreed to assume
and for which Seller exchanged such debt for 71,123 shares
of NexGen common stock.
9. Capital Infusion/Lock Up Agreement/Payment of Certain NexGen Obligations:
(a) Seller agrees to cause additional working capital in the
sum of $210,000 to be obtained as a result of equity investments in NexGen, at a
minimum price of $1.00 per share, prior to the United Closing Date.
Alternatively, Seller may make a no-interest loan to NexGen in said amount,
repayable only as and when such capital, together with additional capital
necessary to pay the costs incurred in connection with the United Acquisition
are also obtained. The proceeds of raising such capital or loan of $210,000
<PAGE> 4
shall be loaned to Unico on the same terms provided for in Section 6.15 of the
Stock Purchase Agreement and Plan of Merger executed contemporaneously herewith
for working capital referred to in such Section 6.15. In the event that Seller
fails to obtain the $210,000 in equity capital or make the loan described herein
within the time recited, then Seller shall surrender to NexGen shares of NexGen
common stock that he owns equal to the deficiency, valuing such shares for
purposes hereof at $0.50 per share. Purchaser shall have the option to purchase
such shares from NexGen at the aforesaid price of $0.50 per share. Purchaser
agrees to accept that Seller has satisfied the obligations of this Section 9(a)
in an amount equal to $170,000 in the form of a loan from NexGen to Unico, and
that Seller's remaining obligation under this Section 9(a) is in an amount of
$40,000; provided, however that the crediting of $170,000 against Seller's
obligation to provide additional working capital is expressly contingent upon:
(1) Seller furnishing the additional $40,000 in working
capital as required by this paragraph 9(a) prior to the effective date of
the United Acquisition; and
(2) Seller obtains the written agreement of the holder
of NexGen's promissory note for $170,000 issued in connection with the
obtaining the funds described above, to extend the date by which such
note shall be paid to a date after each and all of the obligations listed
on Exhibit C hereto have been paid in full.
(b) Seller represents and warrants that:
(1) Upon the execution of this Agreement, Seller shall
own 1,098,272 shares of NexGen common stock.
(2) Except as provided for in subparagraph 9(b)(3),
Seller shall not sell, transfer or otherwise dispose
of any of Seller's NexGen common stock until the
earlier of (i) two years from the Closing and (ii)
the time when all of the 250,000 shares of NexGen's
Series A Preferred stock and 70,000 shares of Series
B Preferred stock issued in connection with the
United Acquisition are either redeemed or converted
to common stock.
(3) Notwithstanding subparagraph 9(b)(2), Seller may
sell up to (i) 150,244 shares of NexGen common stock
held by Seller to the persons and in the amounts
provided for in Exhibit A hereto (which such
transactions have already taken place) and (ii)
250,000 shares of NexGen common stock held by Seller
in private transactions and in compliance with
applicable securities laws; provided, that Seller
may not sell any of the stock provided for in
subparagraph 9(b)(3)(ii) until the payment of
certain debts owed by NexGen's subsidiary,
Independent News Inc. ("INI"), consisting of $15,000
owed by INI to a former employee of INI for advances
made on the former employee's American Express card
and additional debt in the amount of approximately
$6,000 owed by INI to a current employee of INI for
advances made on the employee's American Express
card (collectively, the "INI Debt"); and, provided,
further, that Seller may use the proceeds of the
sale of stock provided for in subparagraph
9(b)(3)(ii) to lend
<PAGE> 5
to NexGen an amount sufficient to pay the INI Debt.
(c) Seller covenants that Seller shall be responsible for
providing sufficient funds, through a sale of Seller's NexGen common stock as
provided for in subparagraph 9(b)(3), through a loan by Seller to NexGen or by
causing NexGen to sell newly issued common stock (at a price no less than $1.00
per share), to cause NexGen to pay the INI Debt within 30 days of the execution
of this Agreement and thereafter up to $50,000 of existing NexGen legal fees.
Any funds advanced to NexGen by Seller to pay the INI Debt or the existing legal
fees shall be evidenced by a note from NexGen to Seller to provide for repayment
of the funds advanced plus interest. Principal and interest shall be due at the
time of repayment which shall be the earlier of (i) two years from the Closing
or (ii) the time when all of the 250,000 shares of NexGen's Series A Preferred
stock and 70,000 shares of Series B Preferred stock issued in connection with
the United Acquisition is either redeemed or converted to common stock. The note
shall bear interest at the applicable federal rate as provided for in section
1274(d) of the Internal Revenue Code, as amended, based on the term of the note,
as determined at the time of repayment. In lieu of such payment, Seller may
elect to receive NexGen Common stock at an exchange rate equal to the sale price
Seller obtained for his stock.
(d) Notwithstanding the provisions of Paragraph 9(c) above,
Purchaser agrees that Seller may provide for the payment of the INI Debt and the
existing legal fees of NexGen contemporaneous with the provision of $210,000 in
working capital to United by causing NexGen to sell newly issued shares of
common stock at a price no less than $1.00 per share, provided however, that the
proceeds of such sales shall be applied: 1st to the payment of the INI Debt, 2nd
to the $210,000 in working capital to United (of which and subject to the
conditions of paragraph 9(c)1) and (2) hereof, $170,000 has already been
provided), 3rd to the payment of NexGen's obligations pursuant to the Merger
Agreement, and 4th to the aforesaid legal fees.
10.Representations and Warranties of Seller and Seller's Associates: Seller and
Seller's Associates represents and warrants to Purchaser as follows:
(a) As of the date hereof, Seller's ownership of NexGen stock
is and shall be as set forth in the Recitals and Paragraph
1 hereof.
(b) Seller acquired the Shares for investment for his own
account and his own beneficial interest and not for the
account or interest of any other person or persons and had,
at the time he acquired the Shares, no present intention of
reselling or otherwise distributing the Shares, but rather
intended to hold the Shares as a long-term investment.
Seller has not offered or agreed to sell his Shares through
any advertisement or general solicitation, instrumentality
of interstate commerce or the mail.
(c) Seller and Seller's Associates have the power and authority
to execute, deliver and perform this Agreement and to
consummate the transaction intended hereby. This Agreement
and all such other agreements and obligations entered into
and undertaken in connection with the transaction
contemplated hereby, constitute the valid and legally
binding obligations of Seller and Seller's Associates,
enforceable against Seller and Seller's Associates in
accordance with their respective terms. Except as provided
herein, no consent, approvals or
<PAGE> 6
waivers are required to be obtained in connection with
Seller's or Seller's Associates performance of the
transaction contemplated hereby. The execution and
performance of this Agreement does not conflict, or
constitute breach of or result in a default under any
contract or indenture to which Seller or Seller's
Associates is a party or to which any of them is subject.
(d) No commission, finder's fee or other consideration of any
kind is being paid by any party to any entity or person in
connection with this Agreement.
(e) No representation or warranty by Seller or Seller's
Associates in this Agreement, or any schedule hereto,
contains or shall contain any untrue statement or omit to
state a material fact.
11.Representations and Warranties of Purchaser:
(a) The Purchaser has acquired the Shares for his own account
for investment, with no present intention of reselling or
otherwise distributing the Shares. The certificates
representing the Shares as issued to the Purchaser, bear a
legend substantially as follows:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES ACTS OF ANY
STATE (THE "ACTS"). THE SHARES HAVE NOT BEEN ACQUIRED WITH A VIEW TO, OR
IN CONNECTION WITH, ANY DISTRIBUTION THEREOF AND MAY NOT BE SOLD,
PLEDGED, HYPOTHECATED, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE
ACTS OR OPINION OF COUNSEL IN A FORM REASONABLY ACCEPTABLE TO THE
CORPORATION THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACTS.
(b) Purchaser has full power and authority to execute, deliver
and perform this Agreement.
12.Survival of Representation and Warranties: The covenants, agreements,
representations and warranties set forth in this Agreement shall survive the
execution of this Agreement and shall not be affected by any investigation,
verification, or prior knowledge by any party hereto or by anyone on behalf
of any such parties.
13.Conditions Precedent to Closing:
(a) Purchaser. The obligation of the Purchaser to consummate
the transactions contemplated hereby were subject to the
following conditions precedent having occurred at or prior
to Closing:
(1) The representation and warranties made by the Seller
and Seller's Associates shall be true and correct in
all material respects as of the Closing; and
(2) The delivery by the Seller of the stock certificates
required by Paragraph 3.
(3) Fulfillment of the conditions specified in
Paragraphs 4, 5, 6 and 7 hereof, to the extent
<PAGE> 7
that such conditions are to be completed on or by
the Closing.
(b) Seller and Seller's Associates. The obligations of the
Seller and Seller's Associates to consummate the
transactions contemplated hereby were subject to the
following condition precedent having occurred at or prior
to Closing:
(1) The representation and warranties made by the
Purchaser shall be true and correct in all material
respects as of the Closing;
(2) The delivery by the Seller of the Purchaser's Note
in a form satisfactory to the parties;
(3) Execution of the definitive agreement for the United
Acquisition; and
(4) Approval by NexGen of: (i) the transfer of Shares to
Purchaser in exchange for the transfer of the
Purchaser's Note from Seller to NexGen; and (ii) the
cancellation and forgiveness of Purchaser's Note as
set forth in Paragraph 6 hereof; and (iii) the
reduction in the Seller's Note in an amount equal to
the Purchase Price.
(c) Purchaser acknowledges that the Shares were transferred from
Seller to Purchaser pursuant to the Prior Agreement.
14.Successors and Assigns; Joint and Several Liability: This Agreement shall be
binding on, and shall inure to the benefit of, the parties hereto and their
respective heirs, legal representatives, successors and assigns. The
representations, warranties, covenants and agreements of Seller and Seller's
Associates made herein shall be deemed to be jointly and severally made by
Seller. The liability of any Seller's Associate shall be limited to a breach
of his respective representations, warranties, covenants and agreements.
15.Validity of Agreement: In the event any provision, or portion thereof, of
this Agreement is held by a court having proper jurisdiction to be for any
reason unenforceable or invalid, the remaining provisions, or portions
thereof, of this Agreement shall continue to exist and shall remain in full
force and effect.
16.Other Agreements: This Agreement sets forth all of the promises, agreements,
conditions, understandings, warranties, and representations between the
parties hereto with respect to the Shares and the other matters described
herein, and there are no other promises, agreements, conditions,
understandings, warranties, or representations, oral or written, express or
implied, between them with respect to the Shares or the other matters
described herein. No change, amendment or modification of this Agreement
shall be valid unless in writing and signed by the parties hereto.
17.Specific Performance: The parties hereto agree that the Shares and other
forms of performance described herein are unique, that failure of Seller or
Seller's Associates to consummate the sale and other transactions intended
hereby will result in irreparable damage to Purchaser, and that specific
performance of these obligations or any other applicable equitable, legal, or
other decree, order, writ, or remedy that shall
<PAGE> 8
require performance by each of the parties or one or both of them, may be
obtained by suit in law or in equity.
18.Governing Law: This Agreement shall be construed in accordance with, and
governed by the laws of, the Commonwealth of Virginia.
19.Assignment: This Agreement may not be assigned by any party without the
prior written consent of all other parties hereto.
20. Counterparts: This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.
21. Bonus to President and Secretary/Treasurer: In addition to the other
obligations set forth in this Agreement, NexGen shall, upon the closing of the
United Acquisition, award to Lawrence Grimes, its outgoing President, stock an
option to purchase 20,000 shares of NexGen Common at a price of $0.02 per share
and award to Kenneth Brochin, its secretary and treasurer, an option to purchase
97,500 shares of NexGen Commonat a price of $0.02 per share, in recognition of
their contributions to NexGen prior to the United Acquisition. Such options
shall be upon the same terms as those options granted to the Purchaser pursuant
to the Purchaser's employment terms as President and CEO of NexGen and to Seller
pursuant to Seller's employment terms as a consultant to NexGen.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
<PAGE> 9
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first shown above.
NEXT GENERATION SELLER:
MEDIA CORP:
/s/ Larry Grimes /s/ Joel Sens
- ---------------------------- -----------------------
By: Lawrence Grimes Joel P. Sens
Title: President
SELLERS ASSOCIATES:
/s/ Larry Grimes
------------------------
Lawrence Grimes
/s/ Kenneth Brochin
------------------------
Kenneth Brochin
/s/ David Grossman
------------------------
David Grossman
/s/ Jeffrey Sens
------------------------
Jeffrey Sens
PURCHASER:
/s/ Gerard Bernier
------------------------
Gerard R. Bernier
<PAGE> 1
EXHIBIT 2.3
AMENDED AND RESTATED
ESCROW AGREEMENT
This amended and restated escrow agreement (the "Agreement") made and
entered this 30th day of December 1998 by and among Next Generation Media Corp.,
a Nevada corporation with a principal place of business at 900 North Stafford
Street, Suite 2003, Arlington, Virginia 22203 (hereinafter "Seller"), T.C.
Equities, Ltd., a Bahamas corporation with a principal place of business at
Charlotte House, Nassau, Bahamas (hereinafter "Buyer"), and the Law Office of
Shane Henty Sutton P.C., a professional corporation incorporated under the laws
of the State of New York with an address at 1 Rockefeller Plaza, Suite 1600, New
York, New York 10020 (hereinafter "Escrow Agent").
WHEREAS, the parties hereto entered into an escrow agreement as of May 1,
1998 (the "Prior Agreement"); and
WHEREAS, Buyer agreed to purchase 70,000 shares of Redeemable Cumulative
Convertible Preferred Stock of the Seller (hereinafter, the "Securities") and
stock purchase warrants for the purchase of common stock of the Seller
(hereinafter, collectively with the Securities, the "Shares") pursuant to an
Securities Subscription Agreement dated May 4, 1998 and as amended and restated
by an Amended and Restated Securities Subscription Agreement dated as of even
date hereof (the "Subscription Agreement"); and
WHEREAS, in partial consideration for entering into the Subscription
Agreement Seller has agreed pursuant to a Stock Purchase Agreement dated May 4,
1998 and as amended and restated by an Amended and Restated Stock Purchase
Agreement as of even date hereof (the "T.C. Equities Stock Purchase Agreement")
to provide Buyer with a Controlling Interest (as defined in the T.C. Equities
Stock Purchase Agreement) in UNICO, Inc., a Delaware Corporation ("UNICO");
WHEREAS, Seller, Buyer and the Escrow Agent desire to enter into this
Agreement to provide for (1) the deposit and the disbursement of the purchase
price for the Shares, (2) the deposit and the delivery of the Shares, and (3)
the deposit and delivery of the shares of UNICO common stock representing a
Controlling Interest, subject to the terms and conditions of this Agreement.
WHEREAS, the Escrow Agent is willing to act as escrow agent under this
Agreement subject to the revised terms required pursuant to the Subscription
Agreement and the T.C. Equities Stock Purchase Agreement, as amended.
NOW, THEREFORE, it is hereby agreed by and among the parties as follows:
1. FUNDS PLACED IN ESCROW
Buyer has delivered the purchase price for the Shares and for the
execution of the T.C. Equities Stock Purchase Agreement of Three Hundred Fifty
Thousand ($350,000.00) to the Escrow Agent. The Escrow Agent has delivered this
cash (less the fees described in Section 6 herein) to the Seller pursuant to the
Prior Agreement.
2. SECURITIES TO BE HELD IN ESCROW
Seller has delivered a certificate representing the Securities which have
a redemption price of $5.00 per share and a face value of $350,000.00, along
with 250,000 common stock purchase warrants in Seller. Seller has also provided
the Escrow Agent a fully executed T.C. Equities Stock Purchase Agreement
providing for the delivery of a Controlling Interest in UNICO.
3. RELEASE OF SHARES AND SETTLEMENT
The Escrow Agent has paid over the $350,000.00 purchase price to Seller
(less the fees described in Section 6 herein) and has delivered the Shares
<PAGE> 2
(including the Securities) to Buyer and shall deliver a copy of the executed
T.C. Equities Stock Purchase Agreement to Buyer by overnight courier service as
of the date of the execution of this Agreement.
4. DUTIES OF ESCROW AGENT
The sole remaining duty of Escrow Agent that has not been satisfied under
the Prior Agreement, other than as hereinafter specified, shall be to receive a
stock certificate representing 1,800,000 shares and a stock certificate
representing 13,187 shares, each of common stock of UNICO and hold them subject
to release in accordance with the terms and conditions of this Agreement and the
T.C. Equities Stock Purchase Agreement. The Escrow Agent shall be under no duty
to make certain that Seller and Buyer are complying with the laws of any
jurisdiction that may apply to any resale of the Shares. The Escrow Agent shall
undertake to perform only such duties as are expressly set forth and no implied
duties or obligations shall be read into this Agreement against the Escrow
Agent. The Escrow Agent may act in reliance upon any writing or instrument,
including any such writing or instrument received by facsimile, or signature
which it in good faith believes to be genuine, may assume the validity and
accuracy of any statement or ascertain contained in such writing or instrument,
and may assume that any person purporting to give any writing, notice, advice,
or instruction in connection with the provisions hereof has been duly authorized
to so do. The Escrow Agent shall not be liable in any manner for the sufficiency
or correctness as to form, manner and execution, or the validity of any
instrument deposited pursuant to this Agreement. The Escrow Agent's duties
hereunder shall be limited to the safekeeping of such instrument and monies
received by it as the escrow agent, and for the maintenance and disposition of
the funds deposited with it in accordance with this Agreement. The Escrow Agent
shall not be liable for collection items until the net proceeds of the same in
actual cash have been received, nor shall it be liable for default in payment of
negotiable documents deposited. It may rely upon paper document or other writing
believed by it to be authentic in making any delivery of money or property
hereunder.
5. ESCROW AGENT'S LIABILITIES
The Escrow Agent's obligations and duties in connection herewith are
confined to those duties specifically enumerated in this Agreement. The Escrow
Agent shall not be in any manner liable or responsible for the sufficiency,
correctness, genuineness, or validity of any instruments deposited with it or
with reference to the form of execution thereof, or the identity, authority, or
rights of any person executing or depositing same, and the Escrow Agent shall
not be liable for any loss that may occur by reason of forgery, false
representations, or the exercise of its discretion in any particular manner or
for any other reason, except for its own negligence or willful misconduct.
6. ESCROW AGENT AND LEGAL FEES
The Escrow Agent's fee herein shall be Two Thousand U.S. Dollars
($2,000.00). This fee is intended as full compensation for the Escrow Agent's
services as contemplated by this Escrow Agreement and has been disbursed through
the proceeds of the transaction. The parties hereto have further authorized the
disbursement of legal fees to The Law Office of Shane Henty Sutton, P.C., as
attorneys for the Buyer, through the proceeds of the transaction as per a
memorandum of costs to be provided by the attorneys, with such costs not to
exceed Eight Thousand Dollars ($8,000.00). The Escrow Agent acknowledges receipt
of $10,000.00 pursuant to the Prior Agreement in satisfaction of these
obligations to the The Law Office of Shane Henty Sutton, P.C. in its capacity as
Escrow Agent and as attorneys for the Buyer.
7. BINDING AGREEMENT AND SUBSTITUTION OF ESCROW AGENT
<PAGE> 3
The terms and conditions of this Agreement shall be binding on the heirs,
executors and assigns, creditors or transferees, or successors in interest,
whether by operation of law or otherwise, of the parties hereto. If for any
reason the Escrow Agent herein, should be unable or unwilling to continue as
such escrow agent, the other parties to this Agreement may substitute another
person to serve as escrow agent. No party may assign its rights or obligations
hereunder without the consent in writing of the other parties hereto.
8. MISCELLANEOUS
The parties covenant and agree that in performing any of its duties under
this Agreement, the Escrow Agent shall not be liable for any loss or damages
which may be occasioned as a result of serving as escrow agent hereunder, except
for any loss or damages occasioned by its willful default or negligence.
The Escrow Agent may, upon ten (10) days written notice, resign as escrow
agent hereunder, provided that such resignation shall not become effective until
such time as a successor escrow agent acceptable to Seller and Buyer has been
appointed.
All notices and communications hereunder shall be in writing and shall be
deemed to be duly given and received if made by prepaid registered mail with
return receipt requested, courier, telecopier, telex, or telegraph to each of
the parties at their respective addresses or such other addresses as may be set
forth in writing by a party and sent to all other parties.
The validity, interpretation, and performance of this Agreement shall be
controlled by and construed under the laws of the State of New York (without
regard to any otherwise applicable conflicts of laws provisions), the State in
which this Agreement is deemed executed, and the parties hereto agree to submit
to that State's jurisdiction.
For the convenience of the parties, any number of counterparts of this
Agreement may be executed by any one or more parties hereto and each such
executed counterpart shall be, and shall be deemed to be, an original
instrument, and to have the force and effect of an original, but all of which
shall constitute, and shall be deemed to constitute, in the aggregate, but one
and the same instrument.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day first above written in New York.
SELLER BUYER
/s/ Larry Grimes /s/ Peter Fletcher
- ------------------------- ---------------------------
Name: Lawrence Grimes Name: Peter Fletcher
Title: President Title: Director
NEXT GENERATION MEDIA CORP. T.C. EQUITIES LTD.
ESCROW AGENT
/s/ Shane Sutton
- -------------------------
Name: Shane Henty Sutton, Esq.
THE LAW OFFICE OF
SHANE HENTY SUTTON P.C.
<PAGE> 1
EXHIBIT 2.4
AMENDED AND RESTATED
STOCK PURCHASE AGREEMENT
This amended and restated agreement of sale and purchase (hereinafter,
the "Agreement") is made and entered into as of the 30th day of December, 1998,
by and between Next Generation Media Corp., a Nevada corporation (hereinafter
"NexGen" or "Seller") and T.C. Equities, Ltd., a Bahamas corporation ("Buyer").
WHEREAS, the parties hereto entered into a Stock Purchase Agreement dated
as of May 4, 1998 (the "Prior Agreement"); and
WHEREAS, due to changed circumstances the parties to the Prior Agreement
and this Agreement wish to amend and restate their agreement in order to
facilitate the closing of the transactions contemplated thereby and hereby; and
WHEREAS, Seller and Buyer have entered into an Amended and Restated
Securities Subscription Agreement governing Buyer's subscription to a total of
70,000 shares of preferred stock of NexGen, and that to induce Buyer to enter
into such agreement and certain amendments thereto, Seller agreed to transfer to
Buyer a controlling interest in UNICO, Inc., a Delaware corporation ("UNICO");
and
WHEREAS, Seller represents that it has transferred a Controlling Interest
(as defined herein) in UNICO to Buyer;
WHEREAS, in order to comply with the terms of the aforementioned Amended
and Restated Securities Subscription Agreement the parties desire to provide for
certain undertakings, conditions, representations, warranties and covenants in
connection with the transactions contemplated hereby.
NOW, THEREFORE, in consideration of the foregoing, and for other
consideration, the receipt and sufficiency of which are acknowledged, the
parties agree as follows:
ARTICLE I
THE PURCHASE PRICE
1.1 Amount. Seller agrees to sell to Buyer, and Buyer agrees to
purchase from Seller, all of the securities held by Seller in UNICO (the
"Purchased Stock") which shall represent a Controlling Interest in UNICO for the
total sum of One Dollar and No Cents ($1.00) and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged.
1.2 Payment. Buyer (i) has delivered to Seller with the execution of
the Prior Agreement, the purchase price of the Purchased Stock then held by
Seller to be transferred to the Escrow Agent (as defined in the Amended and
Restated Escrow Agreement of even date herewith) and (ii) shall deliver to
Seller with the execution and delivery hereof, the Amended and Restated
Securities Subscription Agreement and the Amended and Restated Escrow Agreement.
The "Closing" shall mean the effective date of the merger of Seller's
subsidiary, United Marketing Merger Corp., with and into United Marketing
Solutions Inc. ("UMSI"), a subsidiary of NexGen.
1.3 Additional Undertaking. In conjunction with the sale of Purchased
Stock being sold herein and receiving payment as provided for
herein, Seller shall deliver to Buyer, prior to the Closing, (1) a
letter or letters from all but one of the existing directors of
UNICO in which such directors resign as directors of UNICO and (2)
a letter from the remaining director of UNICO stating that such
director has appointed new members of the board of directors of
UNICO designated in advance by the Buyer and then, effective as of
the Closing, resigning as the final director of the incumbent
board of directors of UNICO.
<PAGE> 2
ARTICLE II
REPRESENTATIONS
1. The Seller makes the following representations and warranties to the
best of its knowledge and based on representations made to Seller by UNICO:
(a) UNICO was incorporated in the State of Delaware on April 11, 1984.
UNICO sold 805,000 shares of its common stock to the public
pursuant to an S-18 offering statement filed with the U.S.
Securities and Exchange Commission (the "SEC"). As of the Closing,
UNICO will have outstanding 5,631,395 shares of common stock, par
value $0.01 per share ("Common Stock").
(b) Seller has delivered to Buyer true copies of all of the filings by
UNICO with the SEC (together with the filing reference numbers)
for the past three (3) years.
(c) UNICO's authorized capital consists of 20,000,000 shares of Common
Stock, and 5,000,000 shares of preferred stock, par value $0.01
per share ("Unico Preferred") of which Seller has one designated
series (the "Unico Series C Preferred"). All issued and
outstanding shares of Common Stock are validly issued, fully paid
and non-assessable. There are no shares of Unico Preferred issued
and outstanding. The Seller has delivered to the Buyer UNICO's
Certificate of Incorporation and By-laws, which shall be the
original sets where practical, each as amended and in effect as of
the Closing and a Certificate of Good Standing from the Secretary
of State of Delaware and evidence of the payment of all Delaware
state franchise taxes by UNICO. As of the Closing, Seller shall
have no more than 3,700,000 common shares and 320,000 preferred
shares issued and outstanding, provided, however, that Seller may
have outstanding certain additional securities convertible into
common stock of Seller pursuant to a private placement transaction
to be undertaken by Seller subsequent to the execution of this
Agreement (the "NexGen Private Placement").
(d) There are no actions, suits, proceedings, governmental
investigations, judgments, orders, injunctions or decrees pending,
outstanding or threatened against UNICO of any kind or nature
whatsoever. UNICO has duly filed all tax reports and returns
required to be filed by it and UNICO owes no federal, state or
local taxes of any kind or nature whatsoever. There are no
outstanding agreements or waivers extending the statutory period
of limitations applicable to any federal or state income tax
return for any period. Additionally, Seller hereby assumes and
represents the Representations and Warranties of Seller as set
forth in paragraph 2 of the Amended and Restated Stock Purchase
Agreement among UNICO, United Marketing Solutions, Inc., Next
Generation Media Corp. and United Marketing Merger Corp., dated as
of December 30, 1998 (the "Amended and Restated NexGen-Unico Stock
Purchase Agreement"), and attached hereto.
(e) Certain of UNICO's securities have been registered under the
Securities Act of 1933, as amended (except for those securities
that are restricted securities under said Securities Act), and
there is no action pending by the Blue Sky Commission of any
State.
(f) UNICO will not as of the Closing have any debts, liabilities or
obligations of any kind or nature whatsoever, including guarantees
of any debts, liabilities or obligations of others, whether
<PAGE> 3
contingent or absolute, matured or unmatured, liquidated or
unliquidated. The foregoing representation has been evidenced by a
Certified Public Accountant by way of a pro forma balance sheet
provided to the Buyer pursuant to the Prior Agreement and will be
confirmed by a Certified Public Accountant by way of an audited
balance sheet provided to the Buyer by the Seller as soon after
the Closing as is practicable, but in no event more than three
weeks following the Closing.
(g) As of the Closing, there are no warrants, stock options,
debentures, bonds or any other type of securities authorized,
reserved, issued or outstanding other than as described herein.
Except as described herein, no further securities will be
authorized or issued before the Closing, and no preemptive or
contractual rights exist with respect to any shares of Common
Stock of UNICO other than pursuant to the Amended and Restated
NexGen-Unico Stock Purchase Agreement.
(h) At the Closing, the Seller will deliver to the Buyer a
stockholders' list dated as of the Closing which shows the name,
address and number of shares owned of record by each shareholder,
the list to contain not less than 503 shareholders.
(i) The Seller has delivered, pursuant to the Prior Agreement, or
shall deliver upon the execution hereof: (1) stock certificates
for four hundred twenty-eight thousand one hundred eighty-five
(428,185) shares of Unico Series C Preferred stock, which were
automatically converted as of August 1, 1998, at a rate of one
share of Unico Series C Preferred for four shares of Common Stock,
into 1,712,740 shares of Common Stock, (2) 359,931 shares of
Common Stock held by certain directors of UNICO as set forth in
the attached Schedule A, purchased by Seller for delivery to Buyer
and (3) 1,800,000 shares of Common Stock purchased by Buyer
pursuant to the Amended and Restated NexGen-Unico Stock Purchase
Agreement in exchange for forgiveness of indebtedness owed by
UNICO to Seller, representing, in the aggregate, not less than
68.77% of the voting power in UNICO (a "Controlling Interest")
duly endorsed for transfer to Buyer or accompanied by duly
executed stock powers in form sufficient to permit transfer of
such shares to Buyer (or Buyer's assigns or nominees), with any
necessary stock transfer tax or other documentary tax stamps
affixed thereto, together with the certificates of preferred and
common stock and evidence of the cancellation of certain
promissory notes issued by UNICO and held by Seller as set out in
the schedule.
(j) Pursuant to the Prior Agreement, UNICO has delivered audited
financial statements as of December 31, 1997, and a pro forma
balance sheet reflecting the finances of UNICO as of the Closing
showing no assets and no liabilities.
(k) The Seller has disclosed to the Buyer all facts material to the
condition, assets, liabilities, businesses and operations of
UNICO.
(l) Neither the Seller nor UNICO, nor any agent acting on their
behalf, has taken or will take any action which would subject the
shares being purchased hereunder to the provisions of Section 5 of
the Securities Act of 1933, as amended, or to the provisions of
any securities or Blue Sky law of any State.
<PAGE> 4
(m) The Seller consents to join with the Buyer, either prior to or as
of the Closing, in issuing a joint statement to the public through
a suitable investor relations consultant as to the nature of the
transaction and to assist UNICO in conjunction with the Buyer in
preparing the necessary proxy statement which shall contain the
Buyer's proposals for UNICO. The costs and expenses for the
preparation of such proxy statement shall be borne by UNICO.
2. The Buyer and Seller confirm that all pre-Closing conditions precedent
to this Agreement have been satisfied pursuant to the Prior Agreement.
ARTICLE III
THE CLOSING
This Agreement shall be executed as of the date of execution of the
Amended and Restated NexGen-Unico Stock Purchase Agreement. Pending the Closing,
Seller and UNICO agree to afford the Buyer and its authorized representatives
full access to all of UNICO's book and records.
Upon delivery of the Purchased Stock, the Buyer agrees that it shall not
with respect to such stock held by or on behalf of Buyer, vote, or take part in
or consent to, any corporate or shareholders' action of UNICO other than a vote
in favor of the merger between United Marketing Solutions, Inc., and United
Marketing Merger Corp., (the "Merger") until the Effective Date (as defined in
the Amended and Restated NexGen-Unico Stock Purchase Agreement) of the Merger,
and Buyer agrees to vote such shares in favor of the Merger. Buyer shall not
receive any distribution in connection with the sale of stock of UMSI from UNICO
to Seller or the consideration received by UNICO therefor. Buyer further agrees
that, until the Effective Date of the Merger, Buyer will not sell, transfer or
otherwise dispose of its shares in UNICO.
ARTICLE IV
SELLER'S CLOSING CONFIRMATIONS
Buyer shall receive at the Closing a letter, dated the date of Closing,
from Seller to the effect that, to the best of Seller's knowledge and based on
representations made to Seller by UNICO:
(a) UNICO is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware.
(b) No consent of or filing with any federal, state or local authority
is required in connection with the execution, delivery and
performance of this Agreement by the Seller.
(c) The authorized capital stock of UNICO consists of twenty million
(20,000,000) shares of Common Stock and five million (5,000,000)
shares of Unico Preferred stock.
(d) There are no lawsuits or proceedings before any court or
administrative agency pending or threatened against or relating to
UNICO, and UNICO is not subject to any threatened or asserted
action which could adversely affect or impair the properties of
UNICO.
(e) The Seller shall undertake and employ reasonable business efforts
to maintain UNICO's listing on the NASD-OTC bulletin board until
the completion of the Merger.
ARTICLE V
SUNDRY PROVISIONS
<PAGE> 5
6.1 Entire Agreement. This Agreement, together with the Amended and
Restated Securities Subscription Agreement of even date herewith
and the Amended and Restated Escrow Agreement of even date
herewith, sets forth the entire understanding between the parties
hereto and supercedes all prior agreements, written or oral,
concerning the subject matter herein or therein. This Agreement
may not be amended except by written agreement signed by all the
parties hereto.
6.2 Binding Agreement. This Agreement shall be binding upon the heirs,
successors and assigns of the parties hereto.
6.3 No Assignment. No Assignment of any rights or obligations
hereunder may be made without the express written consent of the
other parties hereto.
6.4 Expenses. Each of the parties hereto shall assume and bear all
expenses, costs and fees incurred or assumed by it in connection
with the preparation and execution of this Agreement whether or
not the sale and purchase provided for herein shall, in fact, be
effectuated. Each party hereto, by its execution and delivery of
this Agreement, agrees to, and shall indemnify and hold harmless,
the other parties hereto from and against any and all liabilities
or claims in respect to any such expenses, costs or fees.
6.5 Descriptive Headings. The descriptive headings of the several
Articles and sections of this Agreement are inserted for
convenience only and shall not control or affect in any way or to
any extent the meaning, construction or interpretation of this
Agreement or of any of the provisions hereof.
6.6 Counterparts. For the convenience of the parties, any number of
counterparts of this Agreement may be executed by any one or more
parties hereto and each such executed counterpart shall be, and
shall be deemed to be, an original instrument, and to have the
force and effect of an original, but all of which shall
constitute, and shall be deemed to constitute, in the aggregate,
but one and the same instrument.
6.7 Survival of Closing. The provisions of all Articles hereof and all
warranties and representations herein shall survive the Closing
and shall not be merged in the instrument or instruments of
conveyance from Seller to Purchaser.
6.8 Time. Time is of the essence of this Agreement and of the
covenants and provisions hereof.
6.9 Governing Law. This Agreement shall be construed in accordance
with and governed by the laws of the State of New York without
regard to its applicable conflicts of laws provisions.
6.10 Covenant of Further Assurance. The Buyer and Seller, respectively,
covenant and agree, each with the other, that each such party
hereto shall from time to time execute and deliver or cause to be
executed and delivered all such further instruments of conveyance,
transfer, assignments, bills of sale, receipts and other
instruments, and shall take or cause to be taken such further or
other action as the Buyer or Seller, as the case may be, may
reasonably deem necessary in order to transfer and assign to and
to vest in and confirm to the Buyer or to Seller, as the
<PAGE> 6
case may be, title to and possession of all of the rights,
privileges, powers, franchises and property agreed to be and
intended to be so transferred, assigned, vested and confirmed in
such party hereunder, respectively, and otherwise to carry out the
intent and purposes of this Agreement.
ARTICLE VI
TERMINATION OF AGREEMENT
If Buyer fails to approve the Merger, Seller may consider this Agreement
null and void without recourse by Buyer other than a return of the Purchased
Stock from the Buyer and/or the Escrow Agent. The payment, excluding the payment
contained in the Amended and Restated Securities Subscription Agreement of even
date herewith, will be considered as liquidated expenses.
[SIGNATURES APPEAR ON THE NEXT PAGE]
<PAGE> 7
IN WITNESS WHEREOF, the parties hereto have set their hands and seals the
day and year first above written.
SELLER: NEXT GENERATION MEDIA CORP.
/s/ Lawrence Grimes
- ---------------------------
Name: Lawrence Grimes
Title: President
BUYER: T.C. EQUITIES LTD.
/s/ Peter Fletcher
- ---------------------------
Name: Peter Fletcher
Title: Director
<PAGE> 8
SCHEDULE A
UNICO CAPITALIZATION:
2,118,655 Shares of Common Stock issued and outstanding before the
August 1998 conversion of the Series C Preferred Stock
1,712,740 Shares of Common Stock as a result of the conversion of the
Series C Preferred Stock issued and outstanding
1,800,000 Shares of Common Stock sold to NexGen and issued to T.C.
Equities subsequent to the Prior Agreement
- ---------
5,631,395 Total issued and outstanding UNICO Common Stock
All other capital stock and promissory notes to be cancelled by
the Closing.
SHARES TRANSFERRED OR TO BE TRANSFERRED BY NEXGEN TO T.C. EQUITIES LTD:
428,185 shares of Series C Preferred converted
as of 8/1/98 into common stock:(1) 1,712,740
168,744 shares of common stock acquired from Bernier(2) 168,744
178,000 shares of common stock acquired from Bomstad(3) 178,000
13,187 shares of common stock acquired from Zadjel(4) 13,187
1,800,000 addition shares of common stock from NexGen received
as forgiveness of indebtedness of $180,000 1,800,000
---------
TOTAL 3,872,671
3,872,671 / 5,631,395 = 68.77%
- ----------------------------------
(1) Previously transferred to the Escrow Agent.
(2) Of Mr. Bernier's 215,682 common shares listed in UNICO, Inc.'s 1997 10-K,
46,250 are options that will be cancelled, and 688 shares were never issued. Mr.
Bernier's 168,744 shares were previously transferred to the Escrow Agent.
(3) Of Mr. Bomstad's 205,900 common shares listed in UNICO, Inc.'s 10-K, (1)
12,500 are options that will be cancelled, (2) 13,750 are shares that will be
cancelled and (3) 1,650 shares were never issued. Mr. Bomstad's 178,000 shares
were previously transferred to the Escrow Agent.
(4) Previously transferred to the Escrow Agent.
<PAGE> 1
EXHIBIT 2.5
AMENDED AND RESTATED
SECURITIES SUBSCRIPTION AGREEMENT
THIS AMENDED AND RESTATED SECURITIES SUBSCRIPTION AGREEMENT dated as of
December 30, 1998 (the "Agreement'), is executed in reliance upon the exemption
from registration afforded by Rule 505 of Regulation D ("Regulation D") as
promulgated by the U.S. Securities and Exchange Commission (the "SEC"), under
the Securities Act of 1933, as amended (the "Securities Act"). Capitalized terms
used herein and not defined shall have the meanings given to them in Regulation
D.
The parties hereto executed a Securities Subscription Agreement dated as
of May 4, 1998 (the "Prior Agreement") and wish to amend and restate the Prior
Agreement in this Agreement. This Agreement has been executed by T.C. Equities,
Ltd., a Bahamas corporation (hereinafter "Buyer"), in connection with the
private placement of 70,000 shares of Redeemable Cumulative Convertible
Preferred Stock in the company Next Generation Media, Corp., also known as
"NexGen", a corporation organized under the laws of Nevada, with its principal
executive offices located at 900 North Stafford Street, Suite 2003, Arlington,
Virginia 22203 (hereinafter referred to as "Seller"). Buyer hereby represents
and warrants to, and agrees with Seller:
SECURITIES SUBJECT TO THIS AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS, AND NEITHER THE SECURITIES NOR ANY COMPONENT THEREOF OR
INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE
TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS
EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR
(2) THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE OWNER OF SUCH SECURITIES,
WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH
SECURITIES OR COMPONENT THEREOF OR INTEREST THEREIN, MAY BE OFFERED, SOLD,
PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES
LAWS.
1. Agreement To Subscribe: Purchase Price
(a) Subscription. The undersigned Buyer hereby has subscribed
for and agreed to purchase 70,000 shares of Redeemable Cumulative Convertible
Preferred Stock in the company called Next Generation Media, Corp., with a
redemption price of $5.00 per share and a face value of $350,000.00 (hereinafter
the "Shares"). The Buyer may redeem at its option (1) 70,000 shares of the
Shares from and after ten business days after the completion of a private
placement transaction by the Seller of Seller's common stock, par value $0.01
per share that raises, in the aggregate, $2,000,000, which the Seller
anticipates will take place on or before December 1, 1998 through the
broker-dealer Lloyd Wade Securities, Inc. (the "Private Placement"), (2) if the
Private Placement has not yet taken place, 52,500 of the Shares from and after
February 4, 1999 and (3) if the Private Placement has not yet taken place,
70,000 shares of the Shares from and after May 4, 1999. In addition, the Seller
has issued to the Buyer 250,000 warrants (together with the Shares, the
"Securities") for common stock, par value $0.01 per share in NexGen (the
"Underlying Securities") at an exercise price of $0.16 per warrant valid for
period of five (5) years from the date of issue which, under the Prior
Agreement, was May 7, 1998.
(b) Payment. The aggregate Purchase Price for the Securities
paid by the Buyer was Three Hundred Fifty Thousand United States Dollars (U.S.
$350,000.00) (the "Purchase Price"), which was paid simultaneously with the
delivery of the Prior Agreement by delivering immediately available funds in
United States Dollars by wire transfer to the designated depository of Shane
Henty Sutton, P.C., as escrow agent (the "Escrow Agent") for closing by delivery
of securities versus payment together with a fully executed Stock Purchase
Agreement dated May 4, 1998, as amended and restated by an Amended and
<PAGE> 2
Restated Stock Purchase Agreement as of even date hereof (the "T.C. Equities
Stock Purchase Agreement") providing for the delivery of a Controlling Interest
(as defined in the T.C. Equities Stock Purchase Agreement) in UNICO, Inc., a
Delaware Corporation ("UNICO").
(c) Closing. The parties have consummated this transaction
pursuant to the Prior Agreement. The Seller undertakes to proceed with the
Private Placement as promptly as practicable following the execution of this
Agreement. The Seller hereby grants to Buyer "piggy back" registration rights
for the Underlying Securities of the warrants when Seller has an S-1
registration statement declared effective by the SEC.
2. Buyer Representations and Covenants: Access to Information.
In connection with the purchase and sale of the Securities, Buyer
represents and warrants to, and covenants and agrees with Seller as follows:
(i) Buyer is purchasing the Securities for its own account and
Buyer is qualified to purchase the Securities under the laws of its
jurisdiction of residence, is an "accredited investor" as that term is
defined in Regulation D under the Securities Act, and the offer and sale
of the Securities will not violate the securities or other laws of such
jurisdiction; Buyer is not, and on the closing date was not, an affiliate
of Seller;
(ii) All offers and sales of any of the Securities by Buyer
shall be made in compliance with any applicable securities laws of any
applicable jurisdiction and in accordance with Rule 505 under the
Securities Act or pursuant to a registration of the Securities under the
Securities Act and subject to the requirements described in the preamble
of this Agreement;
(iii) The transactions contemplated by this Agreement are not and
will not be part of a plan or scheme by Buyer, to evade the registration
provisions of the Securities Act;
(iv) Buyer understands that the Securities are not registered
under the Securities Act and are being offered and sold to it in reliance
on specific exclusions from the registration requirements of Federal and
State securities laws, and that Seller is relying upon the truth and
accuracy of the representations, warranties, agreements, acknowledgements
and understandings of Buyer set forth herein in order to determine the
applicability of such exclusions and the suitability of Buyer to acquire
the Securities;
(v) Buyer has not conducted or permitted and shall not conduct
or permit any general solicitation relating to the offer and sale of any
of the Securities;
(vi) Buyer has the full right, power and authority to enter into
this Agreement and to consummate the transaction
contemplated herein. This Agreement has been duly
authorized, validly executed and delivered on behalf of
Buyer and is a valid and binding agreement in accordance
with its terms, subject to general principles of equity and
to bankruptcy or other laws affecting the enforcement of
creditors' rights generally;
(vii) The execution and delivery of this Agreement and the
consummation of the purchase of the Securities, and the transactions
contemplated by this Agreement do not and will not conflict with or
result in a breach by Buyer of any of the terms of provisions of, or
constitute a default under, the articles of incorporation or by-laws (or
<PAGE> 3
similar constitutive documents) of Buyer or any indenture, mortgage, deed
of trust, or other material agreement or instrument to which Buyer is a
party or by which it or any of its properties or assets are bound, or any
existing applicable law, rule or regulation of the United States or any
State thereof or any applicable decree, judgment or order of any Federal
or State court, Federal or State regulatory body, administrative agency
or other United States governmental body having jurisdiction over Buyer
or any of its properties or assets;
(viii) All invitation, offers and sales of or in respect of, any
of the Securities, by Buyer and any distribution of Buyer of any
documents relating to any offer by it of any of the Securities will be in
compliance with applicable laws and regulations;
(ix) Buyer will not make any offer or sale of the Securities by
any means which would not comply with the laws and regulations of the
territory in which such offer or sale takes place;
(x) Buyer has been advised to consult its own legal and tax
advisors with respect to applicable resale restrictions and applicable
tax considerations and it is solely responsible (and Seller is not in any
way responsible) for compliance with applicable resale restrictions and
applicable tax legislation;
(xi) No Government Recommendation or Approval. Buyer understands
that no Federal or State or foreign government agency has passed on or
made any recommendation or endorsement of the Securities;
(xii) Current Public Information. Buyer acknowledges that the
Seller is a "Reporting Issuer" and is current with filings (except for
Seller's periodic report for the second quarter of 1998 on Form 10-QSB
which Seller agrees to file promptly following the execution of this
Agreement), and Buyer and its advisors, if any, have been furnished with
the opportunity to ask questions about, and request copies of materials
relating to, the business, finances and operations of Seller. Buyer
further acknowledges that it and its advisors, if any, have received
complete and satisfactory answers to such inquiries, to the extent made;
on the basis of the foregoing, the Buyer believes that an investment
pursuant to the terms hereof is an appropriate and suitable investment
for the Buyer,
(xiii) Buyer's Sophistication. Buyer acknowledges that the
purchase of the Securities involves a high degree of risk, including the
total loss of Buyer's investment. Buyer has such knowledge and experience
in financial and business matters that it is capable of evaluating the
merits and risks of purchasing the Securities. Buyer understands that, at
the time of issuance, the Securities were not registered under the
Securities Act, and therefore Buyer must bear the economic risk of this
investment for the period up to any registration.
(xiv) Tax Status. Buyer is not a "10-percent Shareholder" (as
defined in Section 871(h)(3)(B) of the U.S. Internal Revenue Code of
1986, as amended) of Seller.
(xv) High Degree of Risk. The Buyer realizes that this
investment involves a high degree of risk, including the risk of the
total loss of its investment.
(xvi) Ability to Bear the Risk. The Buyer is able to bear the
economic risk of the investment.
(xvii) Forward Looking Information. The Buyer acknowledges and
understands that any information provided about the Seller's future plans
<PAGE> 4
and prospects is uncertain and subject to all of the uncertainties
inherent in future predictions.
(xviii) Accredited Investor Status. The undersigned
represents and warrants that it is an "accredited investor" as defined in
Regulation D.
(xix) Independent Investigation. The Buyer, in electing to
subscribe for the Securities hereunder, has relied solely upon the
representations and warranties of the Seller set forth in this Agreement
and on independent investigation made by it and its representatives, if
any, and the Buyer has been given no oral or written representation or
assurance from the Seller or any representative of the Seller other than
as set forth in this Agreement or in a document executed by a duly
authorized representative of the Seller making reference to this
Agreement.
3. Seller Representations and Covenants.
(a) Reporting Company Status. Seller is a "Reporting Issuer"
and is current in its filings with the SEC (except for Seller's periodic report
for the second quarter of 1998 on Form 10-QSB which Seller agrees to file
promptly following the execution of this Agreement). The Underlying Securities
are not yet listed on any exchange; however after the filing of an S-1
registration statement Seller undertakes to immediately list the Underlying
Securities on NASDAQ or other equivalent national stock exchange.
(b) Current Publication Information. To the extent requested by
the Buyer, Seller has furnished Buyer with copies of materials relating to the
business finances and operations of the Seller's business.
(c) Concerning the Securities. The issuance, sale and delivery
of the Securities have been duly authorized by all required corporate action on
the part of Seller, and when issued, sold and delivered in accordance with the
terms hereof and thereof for the consideration expressed herein and therein,
will be duly and validly issued, fully paid and non-assessable. The Underlying
Securities issuable upon the close of this Agreement and the exercise of the
warrants being sold herein have been duly and validly reserved for issuance and,
upon issuance shall be duly and validly issued, fully paid, and non-assessable
and will not subject the holders thereof, if such persons are non-U.S. persons,
to personal liability by reason of being such holders. There are no pre-emptive
rights for any shareholder of Seller.
(d) Subscription Agreement. This Agreement has been duly
authorized, validly executed and delivered on behalf of Seller and is a valid
and binding agreement in accordance with its terms, subject to general
principles of equity and to bankruptcy or other laws affecting the enforcement
of creditors' rights generally.
(e) Non-contravention. The execution and delivery of this
Agreement and the consummation of the issuance of the Securities and the
transactions contemplated by this Agreement do not and will not conflict with or
result in a breach by Seller of any of the terms or provisions of, or constitute
a default under, the articles of incorporation or by-laws of Seller, or any
indenture, mortgage, deed of trust, or other material agreement or instrument to
which Seller is a party or by which it or any of its properties or assets are
bound, or any existing applicable law, rule or regulation of the United States
or any State thereof or any applicable decree, judgment or order of any Federal
or State court, Federal or State regulatory body, administrative agency or other
United States governmental body having jurisdiction over Seller or any of its
properties or assets.
<PAGE> 5
(f) Approvals. Seller is not aware of any authorization,
approval or consent of any U.S. governmental body which is legally required for
the issuance and sale of the Securities as contemplated by this Agreement.
(g) Filings. Seller has made or undertakes and agrees pursuant
to the sale of its Securities under Regulation D to make all necessary filings
in connection with the sale of its Securities as required by the laws and
regulations of the United States.
(h) No Prior Offerings. Seller has not undertaken any offerings
in the last six (6) months which should be integrated into the transaction.
(i) Non-Dilution. Seller agrees that, after the close of the
merger between United Marketing Solutions, Inc., a subsidiary of UNICO and
United Marketing Merger Corp., a subsidiary of Seller (the "Merger"), it shall
not dilute the net share value or interest of the Buyer in the Seller either by
issuing additional common shares (other than through the Private Placement) or
by the means of a reverse stock split. In the event that, after the close of the
Merger, additional shares of the Seller are issued to any member of the board of
directors of the Seller or Joel Sens, the Buyer shall receive an equal number of
shares, pari passu, to retain its equity position in the Seller. However, after
the close of the Merger, in the event that Seller needs to issue additional
shares within twelve months from the date of the Prior Agreement (May 4, 1998),
as part of an offer to raise capital in the first six months, Buyer will consent
to such dilution and in consideration Seller will accelerate Buyer's option to
redeem 70,000 Shares as set out in Clause 1 (a) hereof and repay to Buyer the
amount of $350,000.00 at the close of Seller's funding transaction as provided
for in Clause 1 (a) hereof. In the event that such consent is required in the
second six month period, Seller shall accelerate the remaining obligations to
Buyer, which shall then be fully discharged. In all other respects, the terms of
Clause 1 (a) shall remain unchanged. Seller shall have, as of the date hereof,
no more than 3,700,000 shares of issued and outstanding common stock and 320,000
shares of issued and outstanding preferred stock. There shall be no more than
450,000 options to purchase common stock of Seller at $.50 per share, and the
Seller represents that, prior to the redemption of the Shares, no additional
options shall be granted to any party after the date hereof other than pursuant
to the Private Placement.
(j) Obligation to Provide Information. Seller agrees that it
shall keep Buyer informed as to the progress of (1) any registration statement
and filings with the SEC and provide copies of all such filings to Buyer and (2)
the Private Placement.
4. Exemption; Reliance on Representations. Buyer understands that the
offer and sale of the Securities are not being registered under the Securities
Act at the time of issue.
5. Instructions.
(a) Subject to Section 11 hereof, it is the Seller's
responsibility to take all necessary actions and to bear all such costs to issue
the Securities and deliver them to the Escrow Agent as provided herein,
including the responsibility and cost for delivery of any necessary opinion
letter to the transfer agent, if so required, provided Buyer provides such
certificates and information as may be reasonably required to support that
opinion. The Buyer, in whose name the certificate of Shares has been registered,
shall be treated as a shareholder of record from and after the issuance of the
Shares.
(b) The issuance of certificates representing the Securities
hereunder does not in any manner imply that such shares are free from the resale
restrictions more fully described in Section 11 hereof.
<PAGE> 6
6. Registration. Seller acknowledges that Buyer is an offshore trust
company and acknowledges that it shall make no inquiry as to the accredited
status of Buyer and in the event that the Seller fails to issue certificates for
the Underlying Securities as provided hereunder to the Buyer for any reason
other than the Seller's reasonable good faith belief that the representations
and warranties made by the Buyer in this Agreement are invalid or incorrect then
the Seller shall be required, at the request of the Buyer and at the Seller's
expense, to effect the registration of the Underlying Securities as promptly as
is practical. The Seller and the Buyer shall cooperate in good faith in
connection with the furnishing of information required for such registration and
the taking of such other actions as may be legally or commercially necessary in
order to effect such registration. The Seller shall file such a registration
statement within four (4) weeks of Buyer's demand and shall use its diligent
efforts to cause such registration statement to become effective as soon as
practicable thereafter. Such diligent efforts shall include, but not be limited
to, promptly responding to all comments received from the staff of the SEC,
providing Buyer's counsel with a contemporaneous copy of all written
communications from and to the staff of the SEC with respect to such
registration statement and promptly preparing and filing amendments to such
registration statement which are responsive to the comments received from the
staff of the SEC. Once declared effective by the SEC, the Seller shall cause
such registration statement to remain effective until the sale by the Buyer of
all Underlying Securities registered. The Seller shall include on the applicable
registration form the Buyer as a selling shareholder in connection with the
Underlying Securities and upon the effectiveness of such registration statement
Buyer shall have the option to sell the Underlying Securities.
7. Authorized and Issued Shares. The Seller shall at all times
reserve and have available all Securities necessary to comply with the terms of
this Agreement.
8. Delivery Instructions. The Securities being purchased hereunder
have been delivered to the Escrow Agent.
9. Conditions to Seller's Obligation To Sell. Seller's obligation to
sell the Securities is conditioned upon:
(a) The receipt and acceptance by Seller of this Agreement
executed by Buyer.
(b) Delivery to the Escrow Agent of good funds by Buyer as
payment in full of the purchase price of the Securities.
(c) All of the representations and warranties of the Buyer
contained in this Agreement shall be true and correct on the payment date with
the same force and effect as if made on and as of the payment date. The Buyer
shall have performed or complied with all agreements and satisfied all
conditions on its part to be performed, complied with or satisfied at or prior
to the payment date.
(d) No order asserting that the transactions contemplated by
this Agreement are subject to the registration requirements of the Securities
Act shall have been issued, and no proceedings for that purpose shall have been
commenced or shall be pending or, to the knowledge of the Seller, be
contemplated. No stop order suspending the sale of the Securities shall have
been issued, and no proceedings for that purpose shall have been commenced or
shall be pending or, to the knowledge of the Seller, contemplated.
(e) No action shall have been taken and no statue, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency that would prevent the issuance of the Securities. No
<PAGE> 7
injunction, restraining order or order of any nature by a federal or state court
of competent jurisdiction shall have been issued that would prevent the issuance
of the Securities.
10. Conditions To Buyer's Obligation To Purchase. Buyer's obligation
to purchase the Securities is conditioned upon:
(a) The confirmation of receipt and acceptance by Seller of
this Agreement as evidenced by execution of this Agreement by the duly
authorized officer of Seller;
(b) delivery of the Securities to the Escrow Agent; and
(c) the transfer to the Escrow Agent of a fully executed
Agreement for the delivery of a Controlling Interest in UNICO, to the Buyer.
10A. Conditions Satisfied. Buyer and Seller hereby confirm that the
conditions precedent in Sections 9 and 10 hereof were satisfied pursuant to the
Prior Agreement, that the Buyer has purchased the Securities, and that the
Seller has received payment therefor in accordance with the Prior Agreement and
this Agreement.
11. Offering Materials and Resale Restrictions. Except for this
Subscription Agreement, no offering materials and documents have been issued in
connection with the offer and sale of the Securities. The Securities and
Underlying Securities have not been registered under the Securities Act or
applicable state securities laws; neither Buyer, nor any direct or indirect
purchaser of the Securities from Buyer, may directly or indirectly offer or sell
the Securities or Underlying Securities unless the Securities or Underlying
Securities are registered under Securities Act, any applicable state securities
laws, or any exemption from the registration requirements of the Securities Act.
Such statements shall appear (1) on the cover of any prospectus or offering
circular used in connection with the offer or sale of the Securities, (2) in the
underwriting section of any prospectus or offering circular used in connection
with the offer or sale of the Securities, and (3) in any advertisement made or
issued by Seller, Buyer, any other distributor, any of their respective
affiliates, or any person acting on behalf of any of the foregoing. In order to
prevent resale transactions in violation of state securities laws, the Buyer may
only engage in resale transactions, to the extent otherwise permitted, in
jurisdictions in which an applicable exemption is available.
12. Miscellaneous.
(a) Except as specifically referenced herein, this Agreement
constitutes the entire contract between the parties in conjunction with the T.C.
Equities Stock Purchase Agreement, and neither party shall be liable or bound to
the other in any manner by any warranties, representations or covenants except
as specifically set forth herein and therein. Any previous agreement among the
parties related to the transactions described herein or therein is superseded
hereby or thereby. The terms and conditions of this Agreement shall inure to the
benefit of and be binding upon the respective successors and assigns of the
parties hereto. Nothing in this Agreement, express or implied, is intended to
confer upon any party, other than the parties hereto, and their respective
successors and assigns, any rights, remedies, obligations or liabilities under
or by reason of this Agreement, except as expressly provided herein. Neither
party may assign its rights or obligations under this Agreement without the
written consent of the other party.
(b) Buyer is an independent contractor, and is not the agent of
Seller. Buyer is not authorized to bind Seller, or to make any representations
or warranties on behalf of Seller.
<PAGE> 8
(c) Seller represents that Buyer will receive all the benefits
of the representations in the annexed Amended and Restated Stock Purchase
Agreement among UNICO, United Marketing Solutions, Inc., Seller and United
Marketing Merger Corp. dated as of December 30, 1998 in relation to the Seller,
its finances, assets, business prospects or otherwise. Buyer will advise each
purchaser, if any, and potential purchaser of the Securities, of the foregoing
sentence, and that such purchaser is relying on its own investigation with
respect to all such matters, and that such purchaser will be given access to any
and all documents and Seller personnel as it may reasonably request for such
investigation.
(d) All representations and warranties contained in this
Agreement by Seller and Buyer shall survive the closing of the transactions
contemplated by this Agreement.
(e) This Agreement shall be construed in accordance with the
laws of New York applicable to contracts made and wholly to be performed within
the State of New York and shall be binding upon the successors and assigns of
each party hereto. Buyer and Seller hereby waive trial by jury and consent to
exclusive jurisdiction and venue in the State of New York. This Agreement may be
executed in counterparts, and the facsimile transmission of an executed
counterpart to this Agreement shall be effective as an original.
(f)Each of the parties hereto shall assume and bear all
expenses, costs and fees incurred or assumed by it in
connection with the preparation and execution of this
Agreement. Each party hereto, by its execution and delivery
of this Agreement, agrees to, and shall indemnify and hold
harmless, the other parties hereto from and against any and
all liabilities or claims in respect to any such expenses,
costs or fees.
(g)The descriptive headings of the several Articles and
sections of this Agreement are inserted for convenience
only and shall not control or affect in any way or to any
extent the meaning, construction or interpretation of this
Agreement or of any of the provisions hereof.
(h)For the convenience of the parties, any number of
counterparts of this Agreement may be executed by any one
or more parties hereto and each such executed counterpart
shall be, and shall be deemed to be, an original
instrument, and to have the force and effect of an
original, but all of which shall constitute, and shall be
deemed to constitute, in the aggregate, but one and the
same instrument.
(g) The provisions of all Articles hereof and all warranties
and representations herein shall survive the closing and shall not be merged in
the instrument or instruments of conveyance from Seller to Buyer.
(h)The Buyer and Seller, respectively, covenant and agree,
each with the other, that each such party hereto shall from
time to time execute and deliver or cause to be executed
and delivered all such further instruments of conveyance,
transfer, assignments, bills of sale, receipts and other
instruments, and shall take or cause to be taken such
further or other action as the Buyer or Seller, as the case
may be, may reasonably deem necessary in order to transfer
and assign to and to vest in and confirm to the Buyer or to
Seller, as the case may be, title to and possession of all
of the rights, privileges, powers, franchises and property
agreed to be and intended to be so transferred, assigned,
vested and confirmed in such party
<PAGE> 9
hereunder, respectively, and otherwise to carry out the
intent and purposes of this Agreement.
13. Escrow Agent. Seller and Buyer, pursuant to the Prior Agreement,
appointed the Escrow Agent to receive the Purchase Price and the Securities
(together with the Purchase Price, the "Escrowed Property"), and to hold and
disburse the Escrowed Property in accordance with the terms of this Agreement.
The Escrow Agent accepted such appointment on the following terms and
conditions:
(a) It is specifically understood and agreed that the only
obligation of Escrow Agent hereunder is to disburse the Escrowed Property
pursuant to the terms hereof, and Escrow Agent shall have no obligation to
Seller, Buyer or any other party whatsoever, including but not limited to any
party claiming by or through Seller or Buyer upon such disbursement.
(b) Escrow Agent shall not be under any duty to give the
Escrowed Property any greater degree of care than it gives its own similar
property, and it shall have no liability hereunder, whether for negligence or
otherwise, except for the intentional breach of its duties hereunder. Escrow
Agent shall have no duties or responsibilities except those as expressly set
forth herein, and no implied duties or obligations may be read into this
Agreement against the Escrow Agent.
(c) Escrow Agent may consult with counsel and shall be fully
protected, indemnified and held harmless with respect to any action taken or
omitted by Escrow Agent in good faith on advice of counsel.
(d) Escrow Agent makes no representation as to the validity,
value, genuineness or collectability of the Funds or of the Securities or any
other document or instrument held by or delivered to Escrow Agent.
(e) Seller and Buyer hereby unconditionally agree to indemnify
the Escrow Agent and hold it harmless from and against any and all taxes (except
those taxes duly payable by Escrow Agent as a result of the compensation derived
by Escrow Agent hereunder, but including any other federal, state and local
taxes of any kind and other governmental charges), expenses, damages, actions,
suits or other charges incurred by or brought or assessed against Escrow Agent:
(i) for anything done or omitted by Escrow Agent in the
performance of its duties hereunder; or
(ii) on account of its acting in its capacity as Escrow
Agent or stakeholder hereunder, except as a result of its intentional breach of
its duties under this Agreement.
(f) The agreements contained herein shall survive any
termination of this Agreement and the duties of the Escrow Agent hereunder.
<PAGE> 10
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first set forth above.
Official Signatory of Seller:
-----------------------------
NEXT GENERATION MEDIA CORP.
/s/ Larry Grimes
--------------------------
By: Lawrence Grimes
Title: President
Official Signatory of Buyer:
----------------------------
T.C. EQUITIES:
/s/ Peter Fletcher
--------------------------
By: Peter Fletcher
Title: Director
<PAGE> 1
EXHIBIT 2.6
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is dated this 30th day of
December, 1998, among UNICO, INC., a Delaware corporation (the "Seller"), NEXT
GENERATION MEDIA CORP., a Nevada corporation (the "Buyer") and T.C. EQUITIES,
LTD., a Bahamian investment company ("T.C. Equities").
RECITALS
A. The Seller desires to issue to Buyer 1,800,000 shares of common
stock, par value $0.01 ("Common Stock") of Seller on the terms and conditions
set forth below.
B. The Buyer desires to buy from Seller such shares of Common Stock,
on the terms and conditions set forth below.
C. The Buyer has assigned its right to receive the Common Stock
purchased herein to T.C. Equities.
NOW, THEREFORE, in consideration of the foregoing, and for other
consideration, the receipt and sufficiency of which are acknowledged, the
parties agree as follows:
1. Purchase and Sale.
The Seller agrees to issue and does hereby unconditionally and
irrevocably sell, convey, assign and transfer to T.C. Equities, 1,800,000 shares
of Common Stock (the "Purchased Securities") for a price of One Hundred Eighty
Thousand Dollars and No Cents ($180,000.00) and Buyer's obligation to advance
certain other funds to Seller in an amount not less than $54,000 (the "Purchase
Price"). Buyer has paid the Seller $170,000 of the Purchase Price in the form of
cancellation of indebtedness in the same amount owed to Buyer by Seller and
shall have advanced the remaining $54,000, an additional $10,000 of which shall
be forgiven, on or before the effective date of the merger between United
Marketing Merger Corp., a subsidiary of Buyer and United Marketing Solutions
Inc., a subsidiary of Seller.
2. Representations and Warranties.
The Buyer represents and warrants to the Seller as follows:
(a) The Buyer has the financial ability to bear the economic
risk of its investment in the Purchased Securities, has adequate means of
providing for its current needs and contingencies, and has no need for
liquidity in its investment in the Purchased Securities. Further, alone
or with representatives or advisors, the Buyer has such knowledge and
experience in financial and business matters that it is capable of
evaluating the merits and risks of the transactions contemplated by this
Agreement.
(b) The Buyer has had the opportunity to question various
officers of the Seller regarding its assets, business and prospects, and
has received satisfactory answers to all such questions. No
representative of the Seller has made any representation regarding the
current or future value of the Purchased Securities, and the Buyer has
not relied on any such representation in deciding to undertake the
transactions contemplated by this Agreement. In making the decision to
invest in the Seller, the Buyer has relied solely upon independent
investigations made by him or on his behalf.
(c) The Purchased Securities will be acquired by the Buyer in
good faith for investment purposes only, and are not being acquired with
<PAGE> 2
a view to, or for, a "distribution" thereof within the meaning of the
Securities Act of 1933 (the "Securities Act"). The Buyer is aware that
there is presently no market for the resale of the Purchased Securities
and that no market may exist in the future for such resale, and the Buyer
understands that the Purchased Securities are a speculative investment
that involves a substantial risk and the Buyer may lose his entire
investment.
(d) The Buyer understands that the Purchased Securities have
not been registered under the Securities Act, and agrees that none of the
Purchased Securities may be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the
Securities Act. The Buyer will not, directly or indirectly, voluntarily
offer, sell, transfer, pledge, hypothecate or otherwise dispose of (or
solicit any offers to purchase or otherwise acquire or take a pledge of)
any Purchased Securities unless (i) registered pursuant to the provisions
of the Securities Act, or (ii) an exemption from registration is
available under the Securities Act. The Buyer has been advised that the
Seller does not have an obligation, and does not intend, to cause any
Purchased Securities to be registered under the Securities Act, or to
take any action necessary for the Buyer to comply with any exemption
under the Securities Act that would permit such Purchased Securities to
be sold by the Buyer. The Buyer further understands that, if the Buyer
desires to sell or transfer all or any part of the Purchased Securities,
the Seller may require the Buyer's counsel to provide a legal opinion
that the transfer may be made without registration under the Securities
Act. The Buyer understands that the Purchased Securities will bear
substantially the following restrictive legend:
THE SHARES OF STOCK EVIDENCED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("THE ACT") NOR
QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATES, AND HAVE BEEN
ISSUED IN RELIANCE UPON EXEMPTIONS FROM SUCH REGISTRATION AND
QUALIFICATION FOR NONPUBLIC OFFERINGS. ACCORDINGLY, THE SALE,
TRANSFER, PLEDGE, HYPOTHECATION, OR OTHER DISPOSITION OF ANY SUCH
SECURITIES OR ANY INTEREST THEREIN MAY NOT BE ACCOMPLISHED EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND
QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS, OR PURSUANT
TO AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO THE
COMPANY TO THE EFFECT THAT SUCH REGISTRATION AND QUALIFICATION ARE
NOT REQUIRED.
(e) The Buyer affirms that all of the representations and
warranties of the Buyer contained herein, and all information furnished
by the Buyer to the Seller, are true, correct and complete in all
respects.
(f) T.C. Equities makes the same representations and warranties
of the Buyer in Sections 2(a), (b), (c), (d) and (e) as if restated
herein and further represents and warrants that it is as an "accredited
investor" as that term is defined in Regulation D under the Securities
Act.
3. Indemnification by Buyer/T.C. Equities.
The Buyer agrees to indemnify and hold the Seller harmless against, and
will reimburse Seller on demand for, any payment, loss, cost or expense
(including reasonable attorney's fees and reasonable costs of investigation
incurred in defending against such payment, loss, cost or expense or claim
therefor) made or incurred by or asserted against the Seller in respect of any
omission, misrepresentation or breach of warranty on the part of Buyer contained
in this Agreement. T.C. Equities agrees to indemnify and hold the Seller
harmless against, and will reimburse Seller on demand for, any payment,
<PAGE> 3
loss, cost or expense (including reasonable attorney's fees and reasonable costs
of investigation incurred in defending against such payment, loss, cost or
expense or claim therefor) made or incurred by or asserted against the Seller in
respect of any omission, misrepresentation or breach of warranty on the part of
T.C. Equities contained in this Agreement.
4. Taxes and Expenses.
The Buyer covenants and agrees to pay all taxes, if any, on the transfer
to T.C. Equities of the Purchased Securities. Each party shall be individually
responsible for and shall personally pay all costs, liabilities and other
obligations incurred by it or him in connection with the performance of and
compliance with the transactions contemplated by this Agreement.
5. Miscellaneous.
5.1. Notice. Any notice or other communication required or
permitted hereunder shall be in writing and personally delivered, mailed by
registered or certified mail (return receipt requested and postage prepaid),
sent by telegram (with messenger service specified), sent by telecopier (with a
confirming copy sent by regular mail), or sent by prepaid overnight courier
service, and addressed to the relevant party at its address set forth below, or
at such other address as such party may, by written notice, designate as its
address for purposes of notice hereunder.
(a) If to the Buyer, at:
900 North Stafford Street
Suite 2003
Arlington, VA 22203
Telecopy: 703-516-9888
(b) If to the Seller, at:
8380 Alban Road
Springfield, VA 22150
Telecopy: 703-913-0425
(c) If to T.C. Equities, at:
c/o Law Office of Shane Henty Sutton, P.C.
1 Rockefeller Plaza
Suite 1600
New York, NY 10020
Telecopy: 212-265-4680
Notice shall be effective immediately upon personal delivery or telecopy, seven
(7) business days after deposit in the mail, or one (1) business day after
deposit with a telegraph company or overnight courier service.
5.2. Further Assurances. Each party will do such acts, and
execute and deliver to any other party such additional documents or instruments
as may be reasonably requested in order to effect the purpose of this Agreement
and to better assure and confirm unto the requesting party its rights, powers
and remedies hereunder and thereunder.
5.3. Binding Effect; No Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
5.4. Entire Agreement. This Agreement constitutes the full and
entire understanding and agreement among the parties with regard to its subject
matter and supersedes all prior written or oral agreements, understandings,
<PAGE> 4
representations and warranties made with respect thereto. No amendment,
supplement or modification of this Agreement nor any waiver of any provision
hereof shall be made except in writing executed by all parties hereto.
5.5. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF VIRGINIA, WITHOUT
REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS.
5.6. Survival. All representations, warranties, indemnities,
covenants and agreements made by the parties to this Agreement shall survive the
execution of this Agreement.
5.7. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.
5.8. Interpretation. No provision of this Agreement shall be
interpreted or construed against any party because that party or its legal
representative drafted such provision. The titles of the paragraphs of this
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement. For all purposes of this Agreement, unless the
context otherwise requires or as otherwise expressly provided, (a) all defined
terms shall include both the singular and the plural forms thereof; (b)
reference to any gender shall include all other genders; (c) all references to
words such as "herein", "hereof", and the like shall refer to this Agreement as
a whole and not to any particular Article or Section within this Agreement; (d)
the term "include" means "include without limitation"; and (e) the term "or" is
intended to include the term "and/or".
5.9. No Waiver; Remedies Cumulative. No waiver by any party to
this Agreement of any one or more defaults by any other party or parties in the
performance of any of the provisions hereof or thereof shall operate or be
construed as a waiver of any future default or defaults, whether of a like or
different nature. No failure or delay on the part of any party in exercising any
right, power or remedy hereunder or thereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. The remedies provided for herein and therein are
cumulative and are not exclusive of any remedies that may be available to any
party hereto at law, in equity or otherwise.
5.10. Severability. If any term, covenant or condition of this
Agreement, or the application of such term, covenant or condition to any party
or circumstance shall be found by a court of competent jurisdiction to be, to
any extent, invalid or unenforceable, the remainder of this Agreement and the
application of such term, covenant, or condition to parties or circumstances
other than those as to which it is held invalid or unenforceable, shall not be
affected thereby, and each term, covenant or condition shall be valid and
enforced to the fullest extent permitted by law. Upon determination that any
such term is invalid, illegal or unenforceable, the parties hereto shall amend
this Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner.
<PAGE> 5
IN WITNESS WHEREOF, the parties caused this Agreement to be executed and
delivered as of the date first set forth above.
UNICO, INC.
/s/ Gerard Bernier
------------------------------
GERARD BERNIER
PRESIDENT
NEXT GENERATION MEDIA CORP.
/s/ Larry Grimes
------------------------------
LAWRENCE GRIMES
PRESIDENT
T.C. EQUITIES, LTD.
/s/ Peter Fletcher
------------------------------
PETER FLETCHER
DIRECTOR
<PAGE> 1
EXHIBIT 4.1
UNANIMOUS WRITTEN CONSENT OF THE
(1) BOARD OF DIRECTORS OF NEXT GENERATION MEDIA CORP.
The undersigned, being all the members of the Board of Directors
(the "Board of Directors") of NEXT GENERATION MEDIA CORP., a Nevada corporation
(the "Corporation"), pursuant to Sections 78.315, 78.390 and 78.403 of the
General Corporation Law of the State of Nevada (the "NGCL"), do hereby take the
following actions as of December 14, 1998, by unanimous written consent in lieu
of a special meeting and do hereby consent that the resolutions set forth below
shall be deemed to have been adopted to the same extent and to have the same
force and effect as if adopted at a formal meeting of the Board of Directors of
the Corporation, duly called and held for the purpose of acting upon proposals
to adopt such resolutions. Each of the undersigned does hereby waive all formal
requirements, including the necessity of holding a formal meeting and any
requirements that notice of such meeting be given.
The following resolutions are hereby adopted:
WHEREAS, the undersigned constitute all of the members of the Board of
Directors of the Company, and the Bylaws of the Company and the corporation
laws of the State of Nevada permit actions without a meeting of the
directors if all of the members of the Board of Directors consent to such
actions in writing;
WHEREAS, the Board of Directors has determined that it is in the best
interests of the Corporation to purchase all of the outstanding shares of
capital stock of United Marketing Solutions Inc., a Virginia corporation
("UMSI"), and as the sole shareholder of United Merger Company Inc.
("Newco"), for the Corporation and Newco to engage in certain transactions
in connection with the merger of Newco into UMSI (the "Merger") with the
result that UMSI will become a wholly owned subsidiary of the Corporation
and, in connection with and to facilitate the Merger, the Board of Directors
has determined that it is in the best interests of the Corporation to engage
in certain other transactions including a purchase of the Series C Preferred
Shares and subordinated debt of UNICO, Inc., a Delaware corporation
("Unico") and the sale of certain shares of the Corporation for cash and
securities to Gerard R. Bernier, Gerald Bomstad, Jr., Leon Zajdel and T.C.
Equities, Ltd., a Bahamian corporation (collectively, with the Merger, the
"Transactions"); and
WHEREAS, due to changed circumstances, representatives of the Corporation
have revised, amended and restated certain of the documents related to the
Transactions previously executed; and
WHEREAS, there have been presented to the Board of Directors drafts of
various documents related to the Transactions (the "Transaction Documents"),
including, among others:
1. a draft of the Amended and Restated Stock Purchase Agreement and
Agreement of Merger among Unico, UMSI, Newco and the Corporation
(attached hereto as Exhibit A);
2. a draft of the Amended and Restated Stock Purchase and
Shareholders Agreement among Gerard Bernier ("Bernier"), Joel Sens
("Sens"), Lawrence Grimes ("Grimes"), Kenneth Brochin ("Brochin"),
David Grossman, Jeffrey Sens and the Corporation (the "Shareholder
Agreement") (attached hereto as Exhibit B);
3. a draft Consulting Agreement between Sens and the Corporation (the
"Consulting Agreement") (attached hereto as Exhibit C);
<PAGE> 2
4. a draft Release and Waiver to be executed by the Corporation
(attached hereto as Exhibit D);
5. a draft Stock Purchase Agreement between Unico and the Corporation
(attached hereto as Exhibit E);
6. a draft Amended and Restated Stock Purchase Agreement between T.C.
Equities Ltd., a Bahamian corporation ("T.C. Equities") and the
Corporation (attached hereto as Exhibit F);
7. a draft Amended and Restated Securities Subscription Agreement
between T.C. Equities and the Corporation (attached hereto as
Exhibit G); and
8. a draft Amended and Restated Escrow Agreement among T.C. Equities,
the Law Offices of Shane Henty Sutton and the Corporation
(attached hereto as Exhibit H); and
WHEREAS, for purposes of establishing the terms on which Bernier shall
become the President and Chief Executive Officer ("CEO") of the Corporation
upon the consummation of the Transactions, the Board of Directors wishes to
state the terms of such engagement; and
WHEREAS, in connection with the Transactions and the Transaction Documents,
it is deemed to be in the best interests of the Corporation to reserve (a)
150,000 shares of the common stock (par value $0.01 per share) of the
Corporation ("Common Stock") for issuance in the future to employees and
representatives of the Corporation at the discretion of and upon the
determination of the Board of Directors; (b) 500,000 shares of Common Stock
for issuance of 250,000 shares to each of Bernier, upon the terms stated
herein, and Sens, upon the terms described in the Consulting Agreement; and
(c) 20,000 shares of Common Stock for issuance to Grimes and 97,500 shares
of Common stock for issuance to Brochin, each upon the terms stated in the
Shareholder Agreement (collectively, the "Reservation of Stock").
TRANSACTION RESOLUTIONS
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors finds that it is
advisable and in the best interests of the Corporation to enter into the
Transactions; and
BE IT FURTHER RESOLVED, each of the Transaction Documents is hereby approved
in the form presented, together with all such changes, additions and
deletions as to any or all of the terms thereof as any officer executing any
such agreements or instruments may deem necessary or desirable, such
execution by such officer to be conclusive evidence that he deems all of the
terms and provisions thereof to be necessary and advisable; and
BE IT FURTHER RESOLVED, that each officer, or any of them, is authorized to
execute, in the name and on behalf of the Corporation (and, if required,
under the Corporation's corporate seal), as the case may be, and deliver any
other agreements, certificates, instruments or documents such officer deems
necessary, advisable or proper in connection with or pursuant to the
Transaction Documents; and
BE IT FURTHER RESOLVED, that each officer, or any of them, is authorized to
attest the signature of any officer executing on behalf of the Corporation
any Transaction Documents and any other agreement, certificate or instrument
related thereto, and is further authorized to affix the corporate seal
thereto; and
<PAGE> 3
BE IT FURTHER RESOLVED, that each and every officer of the Corporation, or
any of them, is authorized to take any action necessary to pay any expenses
incurred by the Corporation in connection with the execution and delivery of
or performance under any of the Transaction Documents or any other
agreement, instrument or document executed in connection therewith or
pursuant thereto; and
BE IT FURTHER RESOLVED, that each and every officer of the Corporation, or
any of them, is authorized to take such action from time to time on behalf
of the Corporation as he or she may deem necessary, advisable or proper in
order to carry out and perform the obligations of the Corporation under the
Transaction Documents executed by the Corporation pursuant to these
resolutions and under any other agreements, documents or instruments
executed and delivered on behalf of the Corporation pursuant thereto and in
connection therewith, and is further authorized to take such action from
time to time on behalf of the Corporation as he or she may deem necessary,
advisable or proper in order to facilitate the Transactions contemplated
thereby; and
BE IT FURTHER RESOLVED, that each officer, or any of them, be and hereby is
authorized to certify to any parties to Transaction Documents or other
agreements, documents or instruments executed pursuant to these resolutions
a copy of these resolutions and the names and signatures of the
Corporation's officers and employees hereby authorized to act in the
premises, and such parties are hereby authorized to rely upon such
certificate until formally advised by a like certificate of any change
therein, and are hereby authorized to rely on any such additional
certificates; and
BE IT FURTHER RESOLVED, that all the actions of the officers and directors
of the Corporation to date in connection with the Transaction Documents be,
and they hereby are, ratified, approved and confirmed.
RESERVATION OF CAPITAL STOCK
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors approves the
Reservation of Stock for issuance according to the terms of the respective
Transaction Documents described above and, in the case of Bernier, the terms
described herein;
BE IT FURTHER RESOLVED, that the President and Secretary of the Corporation
are authorized and empowered to issue shares of Common Stock to such persons
in the amounts and for the consideration set forth in the Transaction
Documents and, in the case of Bernier, according to the terms described
herein;
BE IT FURTHER RESOLVED, that the shares of common stock issued by the
Corporation pursuant to the foregoing resolution shall be evidenced by
certificates that shall have placed prominently thereon all legends required
by federal law, Nevada law, the Certificate of Incorporation and/or the
Bylaws;
BE IT FURTHER RESOLVED, that each share of common stock issued by the
Corporation pursuant to the foregoing resolution shall be a duly and validly
issued, fully paid and nonassessable share; and
BE IT FURTHER RESOLVED, that the President and Secretary of the Corporation
are authorized, directed and empowered on behalf of the Corporation and in
its name to execute any applications, certificates, agreements, or any other
instruments or documents or amendments or supplements thereto, or to do and
to cause to be done any and all other acts and things as such officers may
in their discretion deem necessary or appropriate to carry out the purposes
of the foregoing resolution.
<PAGE> 4
EMPLOYMENT AGREEMENT FOR BERNIER
NOW, THEREFORE, BE IT RESOLVED, that Bernier be, and is hereby, appointed to
the office of President and CEO of the Corporation, which office he shall
hold in addition to his current appointment as the President and CEO of UMSI
(which shall become a subsidiary of the Corporation upon the consummation of
the Transactions); and
BE IT FURTHER RESOLVED, that such appointment shall initially be for a term
of two (2) years, commencing upon the effective date of the Merger; and
BE IT FURTHER RESOLVED, that the Board of Directors of the Corporation
approves the following terms of compensation for Bernier as follows:
1) The Corporation shall issue as of the effective date of the Merger
to Bernier an option to purchase two hundred fifty thousand
(250,000) shares of its Common Stock at a price of $0.02 per
share, as compensation for Bernier's acceptance to serve as the
President and CEO of the Corporation. Such option shall be
exercisable by Bernier in blocks of the number of shares specified
by Bernier from time to time as Bernier may determine best to suit
his individual tax and financial planning. Upon demand such shares
or such portions thereof as Bernier shall designate, shall from
time to time be registered for sale pursuant to the Securities Act
of 1933, as amended, at the sole expense of the Company. The
option described herein shall become effective as of the effective
date of the Merger.
2) The Corporation shall further issue, under the same terms and
conditions, and subject to the same registration requirements, one
hundred thousand (100,000) shares of Common Stock (as adjusted, if
necessary, to reflect any stock splits or reverse splits from the
date hereof), at the end of each one year term to which Bernier is
so appointed by the Board of Directors; and
BE IT FURTHER RESOLVED, that such compensation shall be separate from, and
in addition to, Bernier's compensation pursuant to his employment agreement
with UMSI, which is hereby ratified and approved; and
BE IT FURTHER RESOLVED, that upon the effective date of the Merger, Bernier
shall be, and hereby is, appointed as a director and Chairman of the
Corporation's Board of Directors; and
BE IT FURTHER RESOLVED, that this action with regard to Bernier's employment
shall, upon its execution by all of the directors of the Corporation, be
effective as of the effective date of the Merger; and, with respect to the
matters treated in the above action, shall remain in full force and effect
until all of the Corporation's and UMSI's rights, duties, powers and
privileges with respect to such matters shall have been fully ratified,
performed, discharged, released or otherwise concluded or terminated.
GENERAL AUTHORITY RESOLUTION
NOW, THEREFORE, BE IT RESOLVED, that the President and Secretary of the
Corporation are authorized, directed and empowered on behalf of the
Corporation and in its name to execute any applications, certificates,
agreements, or any other instruments or documents or amendments or
supplements thereto, or to do and to cause to be done any and all other acts
and things as such officers may in their discretion deem necessary or
appropriate to carry out the purposes of the foregoing resolutions.
[SIGNATURES APPEAR ON THE NEXT PAGE]
<PAGE> 5
IN WITNESS WHEREOF, the undersigned, being all of the members of the
Board of Directors, have executed this consent as of the day and year first
above written. This consent may be executed by facsimile.
/s/ Larry Grimes
----------------------------
Lawrence Grimes,
President and Director
/s/ Kenneth Brochin
----------------------------
Kenneth Brochin,
Secretary, Treasurer and
Director
/s/ David Grossman
----------------------------
David Grossman
Director
/s/ Jeffrey Sens
----------------------------
Jeffrey Sens
Director
/s/ Peter Collins
----------------------------
Peter Collins
Director
