SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (D)
of the
SECURITIES EXCHANGE ACT OF 1934
Date of Report: April 1, 1999
PLANET RESOURCES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
1-7149 82-0277987
(Commission File Number) (IRS Employer Identification Number)
C/O HUNTER M.A. CARR
PRESIDENT
PLANET RESOURCES, INC.
ONE TEN PARK PLACE, SUITE 200
HOUSTON, TEXAS 77084
(Address of principal executive offices)
(281) 578-8800
(Registrant's telephone number, including area code)
ONE TEN PARK PLACE, SUITE 200
HOUSTON, TEXAS 77084
(Former name or former address, if changed since last report)
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
- -------- ------------------------------------
(a) On March 30, 1999 the registrant agreed to acquire 100% of the
capital stock of National Law Library, Inc. ("National") in exchange for
17,020,000 of common stock of the registrant. However, because the registrant
does not have a sufficient number of authorized shares of common stock to
complete the acquisition of 100% of the outstanding capital stock of National,
6,000,000 shares were issued to Hunter M.A. Carr, the controlling shareholder
of National. Prior to the acquisition, National had approximately ten (10)
shareholders. Effective March 26, 1999 the registrant reduced the total
number of outstanding shares of common stock from 4,000,000 to 2,000,000.
When all of the shares of the Registrant agreed to be issued for the
acquisition of 100% of the outstanding capital stock of National have been
issued, the former shareholders of the registrant will own 10% of the total
number of outstanding shares of common stock.
Effective as of the closing date, the registrant's officers and two of
its directors resigned. A.W. Dugan remained as a director. Hunter M.A. Carr,
Jonathan C. Gilchrist and Kelley V. Kirker were appointed as new directors.
Hunter M.A. Carr was elected President and CEO and Jonathan C. Gilchrist was
elected Secretary and Treasurer.
(b) Security ownership of Certain Beneficial Owners and Management
immediately after the closing date:
Title of Name and Address Amount and Nature Percent
Class of Beneficial Owner of Ownership of Class
- --------- -------------------- ------------------ ---------
Common A.W. Dugan 1,517,091(1) 19%
Common Hunter M.A. Carr 6,000,000 75%
as a group (2 Persons)
(1) Options to purchase shares of common stock at a price of $.30 per
share owned by A.W. Dugan were cancelled under the terms of the Agreement and
Plan of Reorganization.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
- -------- ----------------------------------------
(a) As a result of the acquisition, National will become a
wholly-owned subsidiary of the registrant effective March 30, 1999. Based on
the stock ownership that resulted from the acquisition, the transaction will
be accounted for as a purchase in which National is assumed to have acquired
the registrant. The combined company will engage in the business of Internet
law research.
(b) All of the assets owned by National were used in business
activities as described in the previous paragraph. The registrant was
formerly involved in the business of mineral extraction.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
- -------- -------------------------------------
(a) Financial statements of business acquired.
At the date of filing this report, the required financial statements of
National had not been completed and were not available for filing herein. The
registrant has undertaken to file a report on Form 10-KSB as of March 31, 1999
that shall include the required financial statements of National and the pro
forma financial information required by paragraph (b) of this item.
(b) Pro forma financial information.
See paragraph (a) of this item above.
(c) Exhibits.
Exhibit A - Agreement and Plan of Reorganization (without schedules
and exhibits - except Exhibit A)
SIGNATURE
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.
PLANET RESOURCES, INC.
By:/s/Hunter M.A. Carr
---------------------
Hunter M.A. Carr, President and CEO
Date: April 1, 1999
EXHIBIT A
AGREEMENT AND PLAN
OF REORGANIZATION
by and among
PLANET RESOURCES, INC.
NATIONAL LAW LIBRARY, INC.
and the
STOCKHOLDERS OF NATIONAL LAW LIBRARY, INC.
iii
TABLE OF CONTENTS
1. EXCHANGE OF SHARES 1
2. DELIVERY OF SHARES 1
3. REPRESENTATIONS AND WARRANTIES OF NATIONAL AND STOCKHOLDERS 1
3(a) Securities Holders 1
3(b) Financial Statements 1
3(c) Undisclosed Liabilities 2
3(d) Absence of Changes 2
3(e) Litigation, Etc. 2
3(f) Compliance; Governmental Authorizations 2
3(g) Due Organization, Etc. 2
3(h) Tax Matters 2
3(i) Agreements, Etc. 3
3(j) Title to Property and Related Matters 3
3(k) Corporate Records 3
3(l) Licenses; Trademarks; Trade Names, Etc. 3
3(m) Authorization by National 3
3(n) Capitalization 3
3(o) Full Disclosure 3
3(p) Brokerage or Finder's Fees 4
3(q) Share Ownership 4
3(r) Approvals Required 4
4. REPRESENTATIONS AND WARRANTIES OF PLANET 4
4(a) Shares of Common Stock 4
4(b) Due Authorization, Etc. 4
4(c) Financial Statements 4
4(d) Undisclosed Liabilities 4
4(e) Material Adverse Change 4
4(f) Litigation, Etc. 5
4(g) Due Organization, Etc. 5
4(h) Tax Matters 5
4(i) Agreements, Etc. 5
4(j) Capitalization 5
4(k) Disclosure of Material Facts 5
4(l) Corporate Records 5
4(m) Stockholders List 6
4(n) Title to Assets 6
4(o) Compliance; Governmental Authorizations 6
4(p) Brokerage Fees 6
4(q) SEC Filings 6
5. AFFIRMATIVE COVENANTS OF PLANET, NATIONAL AND STOCKHOLDERS 6
5(a) Filing of Form 8-K 6
5(b) Preparation of Disclosure Statement 6
5(c) Application to NASDAQ 6
5(d) Delivery of Disclosure Statement 6
5(e) Delivery of Documents 7
5(f) Future Stock Distributions 7
5(g) Change of Corporation Name 7
5(h) Reserved 7
5(i) Anti-Dilution 7
5(j) Waiver of Preemptive Rights 7
6. CLOSING 7
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF NATIONAL AND STOCKHOLDERS 7
7(a) Truth of Representations and Warranties 7
7(b) Compliance with Covenants 7
7(d) Approval by Legal Counsel 7
7(e) Opinion of Counsel 8
7(f) Officers' Certificate 8
8. CONDITIONS PRECEDENT TO OBLIGATIONS OF PLANET 8
8(a) Truth of Representations and Warranties 8
8(b) Compliance with Covenants 9
8(c) Delivery of Investment Letter 9
8(d) Delivery of Exhibits and Schedules 9
8(e) Opinion of Counsel 9
9. INDEMNIFICATION 9
10. NATURE OF REPRESENTATIONS AND WARRANTIES 9
11. DOCUMENTS AT CLOSING 10
11(a) Documents Delivered by the Stockholders 10
11(b) Documents Delivered by Planet 10
12. MISCELLANEOUS 10
12(a) Further Assurances 10
12(b) Waivers 11
12(c) Notices 11
12(d) Headings 11
(e) Counterparts 11
12(f) Governing Law 11
12(g) Binding Effect 11
12(h) Entire Agreement 11
12(i) Time 11
12(j) Severability 12
12(k) Default Costs 12
<PAGE>
EXHIBITS
A. Holders of Planet Common Stock after Closing
B. National's financial statements at February 28, 1999
C. Certificate and Bylaws of Planet
D. Planet's Stockholders' List
E. Planet Financial Statements at June 30, 1998
F. Form 10-K and Form 10-Q
G. Form of Investment Letter
H. National Material Contracts
I. Planet Material Contracts
J. Indemnification Agreement from New Planet Resources, Inc.
K. Distribution Agreement
SCHEDULES
I. As to National:
1. Liabilities of National Not Disclosed in Financial Statements
2. Adverse Changes since the date of the Financial Statements
3. Litigation
4. Exceptions to Compliance with Laws and Regulations
5. Material Agreements
6. Exceptions to Title to Properties and List of Real Property
7. Licenses, Trademarks, Tradenames, Etc.
8. National's Capitalization
II. As to Planet:
9. Liabilities of Planet Not Disclosed in Financial Statements
10. Adverse Changes Since the Date of the Financial Statements and
Form 10-Q
11. Litigation
12. Material Agreements
13. Exceptions to Title to Properties
14. Exceptions to Compliance with Laws and Regulations
III. Covenants:
15. Reserved
16. Anti-Dilution
Exhibit A - Page 12
Exhibit A - Page 11
Exhibit A - Page 1
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (the "Agreement") is made and
entered into this 25th day of March, 1999, by and among Planet Resources, Inc.,
a Delaware corporation (hereinafter referred to as "Planet"), National Law
Library, Inc., a Texas corporation (hereinafter referred to as "National"),
and the undersigned stockholders ("Stockholders") of National.
R E C I T A L S:
---------------
The Stockholders own all of the issued and outstanding shares of
National's common stock. Planet desires to acquire all of the issued and
outstanding common stock of National, making National a wholly-owned
subsidiary of Planet, and Stockholders desire to exchange all of the shares of
National's common stock, for designated shares of Planet's common stock to be
issued. It is the intention of the parties hereto that: (i) Planet shall
acquire all of the issued and outstanding common stock of National in exchange
solely for the number of designated shares of Planet's authorized but unissued
common stock set forth below (the "Exchange"); (ii) the Exchange shall qualify
as a tax-free reorganization under Section 368(a)(1)(B) of the Internal
Revenue Code of 1986, as amended, and related sections thereunder; and (iii)
the Exchange shall qualify as a transaction in securities exempt from
registration or qualification under the Securities Act of 1933, as amended,
and under the applicable securities laws of each state or jurisdiction where
Stockholders reside.
NOW, THEREFORE, for the mutual consideration set out herein, the parties
hereto agree as follows:
1. EXCHANGE OF SHARES1. Exchange of Shares. Planet, and
Stockholders agree that on the Closing Date (as hereinafter defined)
Stockholders will exchange all of the issued and outstanding shares of the
common stock of National (20,000,000 shares presently outstanding) for
6,000,000 shares (the "Shares") of Planet's common stock, $.001 par value per
share (the "Common Stock") as then issued.
2. DELIVERY OF SHARES2. Delivery of Shares. On the Closing Date,
Stockholders will deliver to Planet the certificates representing all of the
outstanding shares of National's common stock, duly endorsed (or with duly
executed stock powers) so as to make Planet the sole owner thereof free and
clear of all claims and encumbrances except as specifically assumed by Planet.
Simultaneously, on the Closing Date, Planet will deliver the certificates
representing the Shares to Trustees of the Stockholders. After delivery to
Planet of certificates representing all outstanding shares of National and
delivery of the Shares, the issued and outstanding shares of Planet's Common
Stock will be held of record by the persons and in the amounts described in
Exhibit "A."
3. REPRESENTATIONS AND WARRANTIES OF NATIONAL AND STOCKHOLDERS3.
Representations and Warranties of National and Stockholders. Subject as set
out in Section 10, the Stockholders, jointly and severally, as a material
inducement to Planet to enter into this Agreement and consummate the
transactions contemplated hereby, make the following representations and
warranties to Planet, which representations and warranties are true and
correct in all material respects on the Closing Date:
3(a) Securities Holders3(a) Securities Holders. The
-------------------
Stockholders are the only owner, of record, of all of the issued and
outstanding shares of National's common stock.
3(b) Financial Statements3(b) Financial Statements. Exhibit
--------------------
"B" is a copy of the balance sheets of National at February 28, 1999 (the
"Financial Statements").
The Financial Statements fairly present the consolidated financial
condition of National as of the date thereof and the results of operations for
the period covered. The Financial Statements have been prepared in accordance
with generally accepted accounting principles, consistently applied, except as
otherwise stated therein.
3(c) Undisclosed Liabilities3(c) Undisclosed Liabilities.
------------------------
Except as set forth in Schedule 1, at the Closing Date, National: (i) will
have no liabilities or obligations of any nature, fixed or contingent, matured
or unmatured, which are not shown or otherwise provided for in the Financial
Statements except for liabilities and obligations specifically assumed by
Planet or arising in the ordinary course of business, none of which is
materially adverse; and (ii) all reserves established by National and set
forth in the Financial Statements will be adequate and there will be no
material loss contingencies (as such term is used in Statement of Financial
Accounting Standard No. 5 of the Financial Accounting Standards Board) which
are not adequately provided for.
3(d) Absence of Changes3(d) Absence of Changes. Except as set
------------------
forth in Schedule 2, since the date of the Financial Statements, National's
business has been operated in the ordinary course and there has not been:
(i) Any material adverse change in the condition (financial
or otherwise), assets, liabilities, earnings, net worth, business or prospects
of National for such period, in the aggregate, or at any time during such
period;
(ii) Any damage, destruction or loss (whether or not
covered by insurance) materially adversely affecting National, or its
businesses;
(iii) Any declaration, setting aside, or payment of any
dividend or other distribution in respect of any shares of capital stock of
National, or any direct or indirect redemption, purchase or other acquisition
of any such stock;
(iv) Any issuance or sale by National or agreement to sell
any of its securities other than under the terms of the private placement
memorandum dated February 1999; or
(v) Any statute, rule, regulation or order adopted
(including orders of regulatory authorities with jurisdiction over National or
its business) which materially adversely affects National or its business.
3(e) Litigation, Etc3(e) Litigation, Etc.. Except as set forth
---------------
in Schedule 3, or in the Financial Statements; there are no actions, suits,
claims, investigations or legal or administrative or arbitration proceedings
current or so far as the stockholders are aware threatened against National,
its assets or business, whether at law or in equity, or before or by any
Federal, state, municipal, local, foreign or other governmental department,
commission, board, bureau, agency or instrumentality.
3(f) Compliance; Governmental Authorizations3(f) Compliance;
---------------------------------------
Governmental Authorizations. Except as set forth in Schedule 4, National has
complied with all Federal, state, local or foreign laws, ordinances,
regulations and orders applicable to its business, including without
limitation, federal and state securities laws which, if not complied with,
would materially and adversely affect the business of National. National has
all Federal, state, local and foreign governmental licenses and permits
necessary in the conduct of its business, and such licenses and permits are in
full force and effect.
3(g) Due Organization, Etc3(g) Due Organization, Etc..
-----------------------
National is a corporation duly organized, validly existing and in good
standing under the laws of Texas. National has the power to own its
properties and assets and to carry on its business as now presently conducted.
3(h) Tax Matters3(h) Tax Matters. National has filed all
------------
federal, state and local tax or related returns and reports due or required to
be filed, which reports accurately reflect in all material respects the amount
of taxes due. National has paid all amounts of taxes or assessments which
would be delinquent if not paid as of the date of this Agreement, other than
taxes or charges being contested in good faith or not yet finally determined.
3(i) Agreements, Etc3(i) Agreements, Etc.. Schedule 5 contains
---------------
a true and complete list and brief description of all material written or oral
contracts, agreements, mortgages, obligations, understandings, arrangements,
restrictions, and other instruments to which National is a party or by which
National or its assets may be bound. True and correct copies of all written
agreements set forth on Schedule 5 are appended in Exhibit "H." No event has
occurred which (whether with or without notice, lapse of time or the happening
or occurrence of any other event) would constitute a default under any of the
agreements set forth in Schedule 5.
3(j) Title to Property and Related Matters3(j) Title to
----------------------------------------
Property and Related Matters. National has good and marketable title to all
the properties, interests in properties and assets, real and personal,
reflected as being owned by it on the Financial Statements or acquired by it
after the date of the Financial Statements, of any kind or character, free and
clear of any liens or encumbrances, except (i) those referred to in the notes
to the Financial Statements, (ii) those set forth in Schedule 6, and (iii)
liens for current taxes not yet delinquent. Schedule 6 contains a general
description of all real property of National. Except as set forth in said
Schedule 6 and except for matters which may arise in the ordinary course of
business, National's assets are in good operating condition and repair. To
the best of knowledge of Stockholders, there does not exist any condition
which materially interferes with the use thereof in the ordinary course of
National's business.
3(k) Corporate Records3(k) Corporate Records. The corporate
-----------------
records, minute books, and other documents and records of National are
complete and correct. Planet shall have the right to review all corporate
records of National prior to the Closing Date.
3(l) Licenses; Trademarks; Trade Names; Etc. 3(l) Licenses;
--------------------------------------
Trademarks; Trade Names, Etc. Schedule 7 contains a true and complete list of
all licenses and all trademarks, trade names, service marks, copyrights,
know-how, patents and applications for any of the foregoing owned by or
registered in the name of National. There is no current or so far as the
stockholders threatened claim or litigation against National contesting the
right to use any of the trademarks, trade names and know-how or the validity
of any of the licenses, copyrights and patents listed on Schedule 7, or
asserting the misuse of any thereof, nor has there ever been any such claim or
litigation.
3(m) Authorization by National3(m) Authorization by National.
-------------------------
This Agreement constitutes a valid and binding agreement of Stockholders,
enforceable in accordance with its terms except as such enforcement may be
limited by applicable bankruptcy, insolvency, moratorium, and other similar
laws relating to, limiting or affecting the enforcement of creditors rights
generally; and neither the execution and delivery of this Agreement nor the
consummation by Stockholders of the transactions contemplated hereby, nor
compliance with any of the provisions hereof, will violate any statute, law,
rule or regulation or any order, writ, injunction or decree of any court or
governmental authority enforceable against Stockholders, or violate or
conflict with or constitute a default under (or give rise to any right of
termination, cancellation or acceleration under) the terms or conditions or
provisions of any note, bond, lease, mortgage, obligation, agreement,
understanding, arrangement or restriction of any kind to which National or
Stockholders is a party or by which National, Stockholders or their respective
properties may be bound. No consent or approval by any governmental authority
is required in connection with the consummation of the transactions
contemplated hereby.
3(n) Capitalization3(n) Capitalization. The authorized
--------------
capitalization of National is as set forth in Schedule 8. Except as set forth
in said Schedule 8, there are no outstanding or presently authorized
securities, warrants, preemptive rights, subscription rights, options or
related commitments of any nature to issue any of National's securities which
are not reflected in the Financial Statements or in Schedule 8.
3(o) Full Disclosure3(o) Full Disclosure. The Stockholders
---------------
have, and at the Closing Date will have, disclosed to Planet all events,
conditions and facts materially affecting the business and prospects of
National; and that Stockholders have not and will not have, at the Closing
Date, withheld disclosure of any events, conditions, and facts which it may
have knowledge of, or have reasonable grounds to know, may materially,
adversely affect the business and prospects of National.
3(p) Brokerage or Finder's Fees3(p) Brokerage or Finder's Fees.
--------------------------
National has not incurred, nor will it incur, any liability for brokerage or
finder's fees or similar charges in connection with this Agreement or any of
the transactions contemplated hereby.
3(q) Share Ownership3(q) Share Ownership. The shares of
----------------
National's common stock to be exchanged for the Shares in the Exchange are
owned, of record, by Stockholders, free and clear of all liens and
encumbrances of any kind and nature.
3(r) Approvals Required3(r) Approvals Required. No approval,
------------------
authorization, consent, order or other action of, or filing with, any person,
firm or corporation or any court, administrative agency or other governmental
authority is required in connection with the execution and delivery by
Stockholders of this Agreement or the consummation of the transactions
described herein, except as disclosed herein and, except to the extent that
the parties are required to file reports in accordance with relevant
regulations under Federal and state securities laws.
4. REPRESENTATIONS AND WARRANTIES OF PLANET4. Representations and
Warranties of Planet . Subject as set out in Section 10(b)(ix) Planet, as a
material inducement to Stockholders to enter into this Agreement and
consummate the transactions contemplated hereby, make the following
representations and warranties to Stockholders, which representations are true
and correct at this date, and will be true and correct on the Closing Date as
though made on and as of such date:
4(a) Shares of Common Stock4(a) Shares of Common Stock. The
----------------------
Shares to be delivered to Stockholders at Closing will be valid and legally
issued shares of Common Stock, free and clear of all liens, encumbrances, and
preemptive rights, and will be fully-paid and non-assessable shares.
4(b) Due Authorization, Etc4(b) Due Authorization, Etc.. This
----------------------
Agreement has been duly authorized, executed, and delivered by Planet, and
constitutes a legal, valid, and binding obligation of Planet, enforceable in
accordance with its terms; no consent of any federal, state, municipal or
other governmental authority is required by Planet for the execution, delivery
or performance of this Agreement by Planet; no consent of any party to any
contract or agreement to which Planet is a party or by which any of its
property or assets are subject is required for the execution, delivery or
performance of this Agreement by Planet.
4(c) Financial Statements4(c) Financial Statements. Exhibit
--------------------
"E" is a copy of Planet's audited financial statements at June 30, 1998,
including balance sheets, income statements and changes in financial position
and its audited financial statements at August 14, 1998 (collectively the
"Statements"). The Statements fairly and accurately reflect the financial
condition of Planet as of the dates thereof and the results of operations for
the periods reflected therein. The Statements have been prepared in
accordance with generally accepted accounting principles, consistently
applied, except as otherwise stated therein; and the books and records,
financial and others, of Planet are in all material respects complete and
correct and have been maintained in accordance with good business and
accounting practices.
4(d) Undisclosed Liabilities4(d) Undisclosed Liabilities.
------------------------
Except as set forth in Schedule 9, Planet: (i) has no material liabilities or
obligations of any nature, fixed or contingent, matured or unmatured, which
are not shown or otherwise provided for in the Statements; and (ii) all
reserves established by Planet and set forth in the Statements are adequate
and there are no material loss contingencies (as such term is used in
Statement of Financial Accounting Standard No. 5 of the Financial Accounting
Standards Board) which are not adequately provided for.
4(e) Material Adverse Change4(e) Material Adverse Change.
------------------------
Except as set forth in Schedule 10, since the date of the Statements, there
has not been, and as of the Closing Date there shall not have been, any
material changes in Planet's condition (financial or otherwise), or
liabilities (absolute, contingent or otherwise), whether or not arising from
transactions in the ordinary course of business; provided, however, that the
parties have agreed that the financial position of Planet will change to the
extent that Planet incurs costs in connection with the transactions
contemplated by this Agreement.
4(f) Litigation, Etc4(f) Litigation, Etc.. Except as set forth
---------------
in Schedule 11, or in the Statements; there are no actions, suits, claims,
investigations or legal or administrative or arbitration proceedings pending
or threatened against Planet, its assets or business, whether at law or in
equity, or before or by any Federal, state, municipal, local, foreign or other
governmental department, commission, board, bureau, agency or instrumentality;
nor does Planet know or have any reason to know of a threat of such litigation
or any basis for any such action, suit, claim, investigation or proceeding.
4(g) Due Organization, Etc4(g) Due Organization, Etc.. Planet
---------------------
is a corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware, is qualified to business and in good
standing in each state where it is required to be qualified and such
qualification is material and has the corporate power to own its property and
to carry on its business as now being conducted. The Certificate of
Incorporation and By-Laws of Planet, as will be in effect on the Closing Date,
are attached hereto as Exhibit "C" and are made a part hereof.
4(h) Tax Matters4(h) Tax Matters. By closing, Planet will have
-----------
filed all Federal, state and local, tax or related returns and reports due or
required to be filed, which reports accurately reflect in all material
respects the amount of taxes due. By closing, Planet will have paid all taxes
or assessments which have become due, other than taxes or charges being
contested in good faith or not finally determined.
4(i) Agreements, Etc4(i) Agreements, Etc.. Planet has not
---------------
breached, nor is there any pending or threatened claims or any legal basis for
a claim that Planet has breached, nor has an event occurred which with the
passing of time would constitute a breach of any of the terms or conditions of
any agreements, contracts or commitments to which Planet is a party or by
which Planet or its assets are bound. A list of all of Planet's material
contracts, agreements or commitments (whether oral or written) is set forth on
Schedule 12 and true and correct copies of all such contracts and agreements
are appended as Exhibit "I." The execution, delivery and performance of this
Agreement by Planet will not be in conflict with or constitute a default under
any provisions of applicable law, Planet's Certificate of Incorporation or
By-Laws, or any agreement or instrument to which Planet is a party or by which
it or its assets are bound.
4(j) Capitalization4(j) Capitalization. As of the date of this
--------------
Agreement, the capitalization of Planet consists of authorized common stock of
10,000,000 shares, $.001 par value per share, of which 4,000,000 are
outstanding. However, on the Closing Date the authorized common will be
30,000,000 shares of which 2,000,000 will be outstanding in addition to the
number of shares referred to in Section 4(p). All outstanding shares of the
Common Stock have been duly authorized, validly issued, and are fully-paid and
non-assessable, and all such shares were issued in compliance with all
applicable federal and state securities laws. Except for the issuances of
securities referred to in this Agreement, there are no outstanding or
presently authorized securities, warrants, preemptive rights, subscription
rights, options or related commitments of any nature to issue any of Planet's
securities.
4(k) Disclosure of Material Facts4(k) Disclosure of Material
----------------------------
Facts. Planet has, and at the Closing Date will have, disclosed to National
all events, conditions and facts materially affecting the business and
prospects of Planet; and Planet has not and will not have, at the Closing
Date, withheld disclosure of any events, conditions, and facts which it may
have knowledge of, or have reasonable grounds to know may materially,
adversely affect the business and prospects of Planet.
4(l) Corporate Records4(l) Corporate Records. The corporate
-----------------
financial records, minute books, and other documents and records of Planet are
to be available to National at the time of the Closing Date and turned over to
new management in their entirety at Closing. Such records are complete and
correct and have been maintained in accordance with good business and
accounting practices.
4(m) Stockholders List4(m) Stockholders List. Exhibit "D" is a
-----------------
true, correct and complete statement, dated not more than 10 days prior to the
Closing Date, setting forth the names and addresses of Planet's stockholders.
4(n) Title to Assets4(n) Title to Assets. Except as set forth
---------------
in Schedule 13, Planet has good and marketable title to all of its assets,
free of any liens and encumbrances.
4(o) Compliance; Governmental Authorizations4(o) Compliance;
---------------------------------------
Governmental Authorizations. Except as set forth in Schedule 14, Planet has
complied in all respects with all Federal, state, local, or foreign laws,
ordinances, regulations, and orders applicable to its business, including
without limitation federal and state securities laws applicable to all
offerings prior to the Closing Date. Planet has all Federal, state, local and
foreign governmental licenses and permits material to and necessary in the
conduct of its business, and such licenses and permits are in full force and
effect, and no violations are or have been recorded in respect of any such
licenses of permits, and no proceedings are pending or threatened to revoke or
limit the use of such permits.
4(p) Brokerage Fees4(p) Brokerage Fees. Planet has not
---------------
incurred, nor will it incur, any liability for brokerage or finder's fees or
similar charges in connection with this Agreement or any of the transactions
contemplated hereby.
4(q) SEC Filings4(q) SEC Filings. Exhibit "F" contains true,
-----------
correct and complete copies of Form 10-K and Form 10-Q filed by Planet in
respect of the fiscal years ended June 30, 1998 and all subsequent periods,
such forms were true and accurate when filed and remain true and accurate
except as set out in later filings and Schedule 10 contains a brief summary of
all material changes in Planet's financial position and prospectus since the
date of the last filing of Form 10-Q. All required filings are current as of
the date of this Agreement
5. AFFIRMATIVE COVENANTS OF PLANET, NATIONAL AND STOCKHOLDERS5.
Affirmative Covenants of Planet, National and Stockholders. Planet covenants
Stockholders and Stockholders, jointly and severally, covenant to Planet that:
5(a) Filing of Form 8-K. 5(a) Filing of Form 8-K Immediately
------------------
after the Closing Date, Stockholders will procure the prompt preparation and
file with the Securities and Exchange Commission appropriate notice describing
this transaction on Form 8-K or other applicable form, and otherwise comply
with the provisions of the Securities Exchange Act of 1934.
5(b) Preparation of Disclosure Statement. 5(b) Preparation of
-----------------------------------
Disclosure Statement Immediately after the Closing Date, the Stockholders will
procure the preparation of a disclosure statement containing the necessary
information to comply with Rule 15(c)2(11) promulgated by the Securities and
Exchange Commission pursuant to the Securities Exchange Act of 1934 and file
such forms with one or more firms who are members of the National Association
of Securities Dealers, Inc. ("NASD") and with NASD as are necessary to effect
the quotation of Planet's securities in the NASD Electronic Bulletin Board
System.
5(c) Application to NASDAQ. 5(c) Application to NASDAQ After
---------------------
Planet meets the requirements for initial inclusion, Stockholders will procure
the prompt preparation and filing of an application with NASD to qualify the
common stock of Planet for inclusion in the Regular NASDAQ system and
quotation by the NASDAQ Stock Market or listing on the American Stock
Exchange.
5(d) Delivery of Disclosure Statement. 5(d) Delivery of
-----------------------------------
Disclosure Statement The Stockholders will procure the delivery to Planet's
former management of the disclosure statement which includes a description of
this transaction so that Planet's former management can review the
descriptions contained therein of Planet and the terms of the transactions
contemplated by this Agreement.
5(e) Delivery of Documents. 5(e) Delivery of Documents The
---------------------
Stockholders will procure the delivery to Planet's former management, with a
copy to its counsel (at the addresses set forth herein), all reports,
registration statements and other documents, other than exhibits, as filed
with the SEC and the NASD during the one year period commencing on the Closing
Date.
5(f) Future Stock Distributions. 5(f) Future Stock
----------------------------
Distributions After the Closing Date, Stockholders will procure the that any
further distribution of Planet's stock to National's shareholders or otherwise
will be completed in conformity with federal and state securities laws and
regulations pertaining to registration; or, pursuant to an exemption from such
registration requirements.
5(g) Change of Corporate Name. 5(g) Change of Corporation Name
------------------------
Management of National will promptly take the appropriate corporate action to
change the name of Planet Resources, Inc. to National Law Library, Inc. or
another appropriate name selected by management of National.
5(h) _______________. Immediately after the Closing5(h)
Reserved, management of Planet will promptly take the appropriate corporate
action to distribute one hundred percent (100%) of the outstanding capital
stock of Planet's wholly owned subsidiary, New Planet Resources, Inc., to the
shareholders of Planet in accordance with the terms of the Distribution
Agreement attached as Exhibit "K."
5(i) Anti-Dilution. 5(i) Anti-Dilution After the Closing,
-------------
management of Planet will comply with the provisions of Schedule 16.
5(j) Waiver of Preemptive Rights. 5(j) Waiver of Preemptive
---------------------------
Rights The Stockholders waive any rights of preemption they may have in
respect of the transfer of the Common Stock of National whether arising under
the articles of association of National or otherwise.
6. CLOSING 6. Closing. The Closing (the "Closing") shall take
place upon such date (the "Closing Date") as the parties hereto may mutually
agree upon, but shall be no later than March 30, 1999. The Closing shall take
place at the offices of Sonfield & Sonfield, 770 South Post Oak Lane, Suite
435, Houston, Texas 77056, or at such place as may be mutually agreed upon by
the parties.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF NATIONAL AND STOCKHOLDERS7.
Conditions Precedent to Obligations of National and Stockholders. All
obligations of Stockholders under this Agreement are subject to the
fulfillment, prior to or on the Closing Date, of each of the following
conditions:
7(a) Truth of Representations and Warranties. 7(a) Truth of
-------- ------------------------------
Representations and Warranties The representations and warranties by or on
behalf of Planet contained in this Agreement or in any certificate or document
delivered to Stockholders pursuant to the provisions hereof shall be true in
all material respects at and as of the time of Closing as though such
representations and warranties were made at and as of such time.
7(b) Compliance with Covenants. 7(b) Compliance with
---------------------------
CovenantsPlanet shall have performed and complied with all covenants,
agreements, and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing.
7(c) Election of New Directors. The present Directors of Planet
-------------------------
shall have caused the appointment of Hunter M.A. Carr, Jonathan Gilcrest and
Kelly V. Kirker to the Board of Directors of Planet as directed by National
and will have arranged for the resignation of Michael Branstetter and Jack N.
York.
7(d) Approval by Legal Counsel. 7(d) Approval by Legal Counsel
-------------------------
All instruments and documents delivered to National and Stockholders pursuant
to the provisions hereof shall be reasonably satisfactory to legal counsel for
National and Stockholders.
7(e) Opinion of Counsel. 7(e) Opinion of Counsel Planet shall
------------------
have delivered to Stockholders an opinion of Planet's counsel, dated the
Closing Date, to the effect that:
(i) Planet is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(ii) Planet has the corporate power to carry on its
business as now being conducted;
(iii) This Agreement has been duly authorized, executed and
delivered by Planet and is a valid and binding obligation of Planet,
enforceable in accordance with its terms, except to the extent that
enforcement is limited by applicable bankruptcy, reorganization, insolvency,
moratorium, or similar laws affecting creditors' rights and remedies generally
or by general equity principles (and excepting specific performance as a
remedy);
(iv) Planet has taken all corporate action necessary for
its due performance under this Agreement;
(v) The execution and delivery by Planet of this Agreement
and the consummation of the transactions contemplated hereby will not conflict
with or result in a breach of any provisions of, Planet's Certificate of
Incorporation or By-Laws or, to the best of such counsel's knowledge after
inquiry and based upon information provided by Planet, constitute a default
under or give rise to a right of termination, acceleration, or cancellation
under any agreement under which Planet or any of its properties are bound or
violate any court order, writ or decree of injunction applicable to Planet;
(vi) Such counsel does not know, after inquiry, of (a) any
actions, suits or other legal proceedings or investigations pending or
threatened against or relating to or materially adversely affecting Planet;
and (b) any unsatisfied judgments against Planet.
(vii) The authorized and, to such counsel's best knowledge
after inquiry, outstanding capitalization of Planet is as set forth in Section
4(j), all of the outstanding shares of Planet's common stock are validly
issued, fully-paid and non-assessable, without preemptive rights, and to the
best of counsel's knowledge after inquiry, there are no outstanding
subscriptions, options, rights, warrants or other transfer agreements (whether
oral or written), other than as set forth in Section 4(j) of this Agreement.
7(f) Officers' Certificate7(f) Officers' Certificate. There
---------------------
shall be delivered to Stockholders an officers' certificate, signed by A.W.
Dugan, President to the effect that all of the representations and warranties
of Planet set forth herein are true and complete in all material respects as
of the Closing Date, and that Planet has complied in all material respects
with its covenants and agreements set forth herein required to be complied
with by the closing.
7(g) Indemnification Agreement. There shall be delivered to
-------------------------
stockholders an Indemnification Agreement whereby New Planet Resources, Inc.
indemnifies Planet, its officers, directors and shareholders from any
liability, cost, expense or damage with respect to the mineral property
transferred from Planet to New Planet. The Indemnification Agreement will be
substantially in the form of Exhibit "J" hereto.
8. CONDITIONS PRECEDENT TO OBLIGATIONS OF PLANET8. Conditions
Precedent to Obligations of Planet. All obligations of Planet under this
Agreement are subject to the fulfillment, prior to or on the Closing Date, of
each of the following conditions:
8(a) Truth of Representations and Warranties. 8(a) Truth of
-------- ------------------------------
Representations and WarrantiesThe representations and warranties by
Stockholders contained in Section 3 this Agreement or in any certificate or
document delivered to Planet pursuant to the provisions hereof shall be true
in all material respects at and as of the time of Closing as though such
representations and warranties were made at and as of such time.
8(b) Compliance with Covenants. 8(b) Compliance with
---------------------------
CovenantsThe Stockholders shall have performed and complied with all
Covenants, agreements, and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing.
8(c) Delivery of Investment Letter.8(c) Delivery of Investment
-----------------------------
Letter Each of Stockholders shall have delivered to Planet an "investment
letter" in the form attached as Exhibit "G," setting out that the shares being
acquired are restricted shares and are being acquired for investment purposes
only, and not with a view to public resale or distribution.
8(d) Delivery of Exhibits and Schedules. 8(d) Delivery of
----------------------------------
Exhibits and SchedulesThe Stockholders shall have delivered all of the
exhibits and schedules required herein to Planet and such exhibits, schedules
and Financial Statements shall have been acceptable to Planet, in its sole
and absolute discretion.
8(e) Opinion of Counsel. 8(e) Opinion of CounselNational shall
------------------
have delivered to Planet an opinion of counsel, dated the Closing Date, to the
effect that:
(i) National is a corporation duly organized, validly
existing and in good standing under the laws of Texas;
(ii) National has the corporate power to carry on its
business as now being conducted;
(iii) Except as referred to herein, such counsel knows,
after inquiry, of (a) no actions, suit or other legal proceedings or
investigations pending or threatened against or relating to or materially
adversely affecting National; and (b) no unsatisfied judgments against
National;
(iv) The authorized capitalization of National is as set
forth in Section 3(n), all of the outstanding shares of common stock of
National are validly issued, fully-paid and non-assessable, without preemptive
rights, and to the best of counsel's knowledge, after inquiry, there are no
outstanding subscriptions, options, rights, warrants or other transfer
agreements (whether oral or written) obligating National to issue or transfer
from treasury any of its securities except as set forth in Section 3(n) of
this Agreement. When duly transferred to Planet as provided herein, to the
best of such counsel's knowledge after inquiry, Planet will own all of the
issued and outstanding common stock of National subject to registration of the
transfer of such shares by the directors of National and due stamping of the
share transfer.
(v) National is the owner of the intellectual property
described on Schedule 7 hereto free and clear of any claims liens or charges.
9. INDEMNIFICATION9. Indemnification. Subject as set out in Section
10, each party to this Agreement shall indemnify and hold harmless each other
party to this Agreement at all times after the date of this Agreement against
and in respect of any liability, damage or deficiency, all actions, suits,
proceedings, demands, assessments, judgments, costs and expenses including
attorney's fees (through all appeals) incident to any of the foregoing,
resulting from any misrepresentation or breach of warranty contained in
Section 3 or 4 as appropriate on the part of such party under this Agreement.
Subject to the terms of this Agreement, the defaulting party shall reimburse
the other party or parties, on demand, for any reasonable payment made by said
parties at any time after Closing, in respect of any liability or claim to
which the foregoing indemnity relates, if such payment is made after
reasonable notice to the other party to defend or satisfy the same and such
party failed to defend or satisfy same.
10. NATURE OF REPRESENTATIONS AND WARRANTIES10. Nature of
Representations and Warranties. All of the parties hereto are executing and
carrying out the provisions of this Agreement in reliance on the
representations, warranties, covenants and agreements contained in this
Agreement or at the Closing of the transactions herein provided for, and any
investigation which they might have made or any other representations,
warranties, agreements promises or information, written or oral, made by the
other party or any other person shall not be deemed a waiver of any breach of
any such representation, warranty, covenant or agreement.
11. DOCUMENTS AT CLOSING11. Documents at Closing. At the Closing,
the following transactions shall occur, all of such transactions being deemed
to occur simultaneously:
11(a) Documents Delivered by the Stockholders. 11(a) Documents
---------------------------------------
Delivered by the StockholdersStockholders will deliver, or cause to be
delivered, to Planet the following:
(i) stock certificates for the shares of common stock of
National being exchanged hereunder, duly endorsed or with stock powers
attached in blank but subject to a customary restrictive stock legend.
(ii) the opinion of counsel for National as set forth
herein;
(iii) a certificate from the Secretary of State of Texas
dated not more than fifteen (15) days prior to the date of Closing to the
effect that National is in good standing under the laws of the said state; and
(iv) such other instruments, documents and certificates, if
any, as are required to be delivered pursuant to the provisions of this
Agreement or which may be reasonably requested in furtherance of the
provisions of this Agreement;
11(b) Documents Delivered by Planet. 11(b) Documents Delivered
-----------------------------
by PlanetPlanet will deliver or cause to be delivered to Stockholders and
National:
(i) stock certificates for the Shares subject to a
customary restrictive stock legend;
(ii) all corporate records of Planet, including without
limitation corporate minute books (which shall contain copies of the
Certificate of Incorporation and By-Laws, as amended to the Closing), stock
books, stock transfer books, corporate seals, and such other corporate books
and records as may reasonably requested by the Stockholders and their counsel;
(iii) a certificate of Planet's officers to the effect that
all representations and warranties of Planet made under this Agreement are
reaffirmed on the Closing Date, as though originally given to Stockholders and
National on said date;
(iv) the opinions of Planet's counsel set forth herein;
(v) a Certificate from the Secretary of State of Delaware
dated at or about the date of Closing that Planet is in good standing under
the laws of said state; and
(vi) such other instruments and documents, if any, as are
required to be delivered pursuant to the provisions of this Agreement, or
which may be reasonably requested in furtherance of the provisions of this
Agreement.
12. MISCELLANEOUS12. Miscellaneous.
12(a) Further Assurances12(a) Further Assurances. At any time,
------------------
and from time to time, after the Closing, each party will execute such
additional instruments and take such action as may be reasonably requested by
the other party to confirm or perfect title to any property transferred
hereunder or otherwise to carry out the intent and purposes of this Agreement;
12(b) Waivers12(b) Waivers. Any failure on the part of any
-------
party hereto to comply with any of its obligations, agreements or conditions
hereunder may be waived in writing by the party to whom such compliance is
owed.
12(c) Notices12(c) Notices. All notices and other communications
-------
hereunder shall be in writing and shall be deemed to have been given if
delivered in person or sent by prepaid first class registered or certified
mail, return receipt requested to the following addresses, or such other
addresses as are given to other parties in the manner set forth herein.
Planet: Planet Resources, Inc.
1415 Louisiana, Suite 3100
Houston, Texas 77002
Attn: A.W. Dugan, President
Tel: (713) 658-1142
With a copy to: Robert L. Sonfield, Jr., Esq.
Sonfield & Sonfield
770 South Post Oak Lane, Suite 435
Houston, Texas 77056-1913
Tel: (713) 877-83333
National: National Law Library, Inc.
1 Park Ten Place, Suite 200
Houston, Texas 77084
Attn: Hunter M.A. Carr, Chairman & CEO
With a copy to: Jonathan C. Gilchrist
1 Park Ten Place, Suite 200
Houston, Texas 77084
12(d) Headings12(d) Headings. The section and subsection headings
--------
in this Agreement are inserted for convenience and shall not affect in any way
the meaning or interpretation of this Agreement.
12(e) Counterparts. (e) Counterparts This Agreement may be
executed simultaneously in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the
same instrument. A facsimile signature by any party on a counterpart of this
Agreement shall be binding and effective for all purposes. Such party shall,
however, subsequently deliver to the other party an original executed copy of
this Agreement.
12(f) Governing Law. 12(f) Governing Law This Agreement shall
-------------
be governed by the laws of Delaware.
12(g) Binding Effect. 12(g) Binding Effect This Agreement
--------------
shall be binding upon the parties hereto and inure to the benefit of the
parties, their respective heirs, administrators, executors, successors and
assigns.
12(h) Entire Agreement. 12(h) Entire Agreement This Agreement
----------------
is the entire agreement of the parties covering everything agreed upon or
understood in the transaction. There are no oral promises, conditions,
representations, understandings, interpretations or terms of any kind as
conditions or inducements to the execution hereof.
12(i) Time12(i) Time. Time is of the essence.
----
12(j) Severability12(j) Severability. If any part of this
------------
Agreement is determined by a court of competent jurisdiction to be
unenforceable, the balance of the Agreement shall remain in full force and
effect.
12(k) Default Costs12(k) Default Costs. In the event any party
-------------
hereto has to resort to legal action to enforce any of the terms hereof, such
party shall be entitled to collect attorneys' fees and other costs from the
party in default.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first above written.
ATTEST: PLANET RESOURCES, INC.
By:/s/Jacque N. York By:/s/A.W. Dugan
------------------- --------------
Jacque N. York, Secretary A.W. Dugan, President
ATTEST: NATIONAL LAW LIBRARY, INC.
By:/s/Jonathan C. Gilchrist By:/s/Hunter M.A. Carr
-------------------------- ---------------------
Jonathan C. Gilchrist, Acting Secretary Hunter M.A. Carr, President
STOCKHOLDERS OF NATIONAL LAW LIBRARY, INC.
______________ ______________
______________ ______________
______________ ______________
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