Washington D.C. 20549
FORM 8-K
Amendment 1
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of earliest event reported, March 23, 2000
CHESHIRE DISTRIBUTORS, INC.
Delaware 000-26186 84-1209978
- ------------------------ ------------------------ -----------------
(State of Incorporation) (Commission File Number) (IRS I.D. Number)
1599 Post Road East
Westport, CT 06880
--------------------------------------------------
(Address of principal executive offices)(Zip Code)
(203) 255-4116
----------------------------------------------------
(Registrant's telephone number, including area code)
PACIFIC DEVELOPMENT CORPORATION
------------------------------------------------------
(Former name or address, if changed since last report)
-1-
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 1. Change in State of Domicile of Registrant
Pursuant to an Agreement of Merger and Plan of Merger and Reorganization dated
March 10, 2000 (the "Agreement") by and among Pacific Development Corporation
(the "Corporation") a Colorado corporation and the Corporation's wholly owned
subsidiary, Cheshire Holdings, Inc., a Delaware corporation ("Holdings"),
Holdings and the Corporation were merged into a single corporation existing
under the laws of the State of Delaware, with Holdings being the surviving
corporation. The merger took effect on March 24, 2000. Simultaneously with the
merger, the name of the surviving corporation was changed to Cheshire
Distributors, Inc. ("Distributors"). Pursuant to the provisions of the
Agreement, each share of the Corporation's issued and outstanding stock
immediately before the effective date of the merger was automatically converted
into one fully paid share of Distributor's stock without action on the part of
the stockholder .
Item 7. Financial Statements and Exhibits
(c) Exhibits.
2.1 Agreement of Merger and Plan of Merger and Reorganization
dated March 10, 2000 by and between Pacific Development
Corporation (the "Corporation" or the "Registrant") a
Colorado corporation and Cheshire Holdings, Inc., a
Delaware corporation., the Corporation's wholly owned
subsidiary.
2.2 Certificate of Merger of Pacific Development Corporation
with Cheshire Holdings, Inc. (Delaware)
2.3 Articles of Merger of Foreign & Domestic Corporations.
(Colorado)
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.
CHESHIRE DISTRIBUTORS, INC.
----------------------------
(Registrant)
Dated: April 11, 2000
By:s/ Gilad Gat
---------------------------
Gilad Gat, Vice President
-1-
AGREEMENT OF MERGER AND
PLAN OF MERGER AND REORGANIZATION
Agreement of Merger and Plan of Merger and Reorganization dated March
10, 2000 by and between Cheshire Holdings, Inc. a Delaware corporation
("Cheshire"), and Pacific Development Corporation, a Colorado corporation
("Pacific") (hereinafter, the "Constituent Corporations").
WHEREAS:
1. The Board of Directors of Cheshire and Pacific have
resolved that Cheshire be merged (hereinafter called the
"merger") under and pursuant to the Colorado Corporation
Law and the Delaware General Corporation Law into a
single corporation existing under the laws of the State
of Delaware, to wit, Cheshire, which shall be the
surviving corporation (such corporation in its capacity
as such surviving corporation being sometimes referred to
herein as the "Surviving Corporation") in a transaction
qualifying as a reorganization within the meaning of
Section 368(a)(1)(F) of the Internal Revenue Code of
1986, as amended;
2. The authorized capital stock of Cheshire consists of
100,000,000 shares of capital stock with a par value of
$.001 per share (hereinafter called "Cheshire Stock"),
1,000 shares of which are issued and outstanding;
3. The authorized capital stock of Pacific consists of
100,000,000 shares of capital stock with a par value of
$.001 per share (hereinafter called "Pacific Stock")
10,365,000 shares of which are issued and outstanding;
4. The respective Boards of Directors of Cheshire and Pacific
have approved the Merger upon the terms and conditions
hereinafter set forth and have approved this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements, provisions and covenants herein contained, the parties hereto hereby
agree, in accordance with the Colorado Corporation Law and the Delaware General
Corporation Law, that Pacific shall be, at the Effective Date (as hereinafter
defined), merged into a single corporation existing under the laws of the State
of Delaware, to wit, Cheshire, which shall be the Surviving Corporation, and
which simultaneously with filing as part of the Certificate of Merger, shall
change its name to Cheshire Distributors, Inc., and the parties hereto adopt and
agree to the following agreements, terms and conditions relating to the Merger
and the mode of carrying the same into effect.
-1-
<PAGE>
1. SHAREHOLDERS' CONSENTS; FILINGS; EFFECTS OF MERGER
1.1 Action by Shareholders of Pacific. Pacific shall obtain the
approval of its shareholders, in accordance with the Colorado Corporation Law,
at the earliest practicable date, which written consent shall, among other
matters, adopt and ratify this Agreement.
1.2 Action by Pacific as Sole Shareholder of Cheshire. At the earliest
practicable date, Pacific, as the sole shareholder of Cheshire, shall adopt this
Agreement in accordance with the Colorado Revised Statutes.
1.3 Filing of Articles of Merger, Effective Date. If (a) this Agreement
is adopted by the shareholders of Cheshire, in accordance with the Delaware
General Corporation Law, (b) this Agreement has been adopted by Pacific as the
sole shareholder of Cheshire, in accordance with the Colorado Corporation Law,
and (c) this Agreement is not thereafter, and has not theretofore been
terminated or abandoned as permitted by the provisions hereof, then an Articles
of Merger shall be filed and recorded in accordance with the Colorado
Corporation Law and Articles of Merger shall be filed and recorded in accordance
with the Delaware General Corporation Law. Such filings shall be made on the
same day. The Merger shall become effective at 9:00 A.M. on the calendar day
following the day of such filing in Delaware, which date and time is herein
referred to as the "Effective Date."
1.4 Certain Effects of Merger. On the Effective Date, the separate
existence of Pacific shall cease, and Pacific shall be merged into Cheshire,
which, as the Surviving Corporation, shall possess all the rights, privileges,
powers and franchises, of a public as well as of a private nature, and be
subject to all the restrictions, disabilities and duties of each of the
Constituent Corporations; and all and singular, the rights, privileges, powers
and franchises of the Constituent Corporations, and all property, real, personal
and mixed, and all debts due to the Constituent Corporations on whatever
account, as well as for stock subscriptions and all other things in action or
belonging to such Constituent Corporations, shall be vested in the Surviving
Corporation; and all property, rights, privileges, powers and franchises, and
all and every other interest shall be thereafter as effectually the property of
the Surviving Corporation as they were of the Constituent Corporations, and the
title to any real estate vested by deed or otherwise, under the laws of Delaware
or any other jurisdiction, in any of the Constituent Corporations, shall not
revert or be in any way impaired; but all rights of creditors and all liens upon
any property of any of the Constituent Corporations shall be preserved
unimpaired, and all debts, liabilities and duties of the Constituent
Corporations shall thenceforth attach to the Surviving Corporation and may be
-2-
<PAGE>
enforced against it to the same extent as if said debts, liabilities and duties
had been incurred or contracted by it. At any time, or from time to time, after
the Effective Date, the last acting officers of Pacific, or the corresponding
officers of the Surviving Corporation may, in the name of Pacific, execute and
deliver all such proper deeds, assignments and other instruments and take or
cause to be taken all such further or other action as the Surviving Corporation
may deem necessary or desirable in order to vest, perfect or confirm in the
Surviving Corporation title to and possession of all of the Constituent
Corporations property, rights, privileges, powers, franchises, immunities and
interests and otherwise to carry out the purposes of this Agreement.
II. NAME OF SURVIVING CORPORATION; ARTICLES OF INCORPORATION; BYLAWS;
2.1 Name of Surviving Corporation. The name of the Surviving
Corporation from and after the Effective Date shall be Cheshire Distributors,
Inc.
2.2 Articles of Incorporation. The Articles of Incorporation of
Cheshire as in effect on the date hereof, shall, from and after the Effective
Date, be and continue to be the Articles of Incorporation of the Surviving
Corporation, until changed or amended as provided by law.
2.3 Bylaws. The Bylaws of Cheshire, as in effect immediately before the
Effective Date shall, from and after the Effective Date, be and continue to be
the Bylaws of the Surviving Corporation, until amended as provided therein.
III STATUS AND CONVERSION OF SECURITIES
3.1 Pacific Stock. Each share of Pacific Stock which shall be issued
and outstanding immediately before the Effective Date shall, by virtue of the
Merger and without any action on the part of the holder thereof, be converted at
the Effective Date into one (1) fully paid share of Cheshire Stock.
3.2 Cheshire Stock held by Pacific. All issued and outstanding shares
of Cheshire Stock held by Pacific immediately before the Effective Date shall,
by virtue of the Merger and at the Effective Date, cease to exist and the
certificate(s) representing such shares shall be canceled.
3.3 Surrender of Certificates. After the Effective Date, certificates
evidencing outstanding shares of Pacific Stock shall evidence the right of the
holder thereof to receive a certificate(s) for shares of Cheshire Stock as
aforesaid. Holders of certificates representing shares of Pacific Stock, upon
-3-
<PAGE>
surrender of such certificates to the transfer agent of the Cheshire Stock to
effect the exchange of certificates, shall be entitled to receive, upon such
surrender, a certificate or certificates representing a like number of shares of
Cheshire Stock. Until so surrendered, outstanding certificates for shares of
Pacific Stock shall be deemed for all corporate purposes, including voting
rights, subject to the further provisions of this Article 3, to evidence the
ownership of the shares of Cheshire Stock into which such shares of Pacific
Stock have been so converted. No dividends or distributions will be paid to the
person entitled to receive certificates for shares of Cheshire Stock pursuant
hereto until such person shall have surrendered his Pacific Stock certificates;
but there shall be paid to the record holder of such certificate, with respect
to the number of shares of Cheshire Stock issued in exchange therefor (i) upon
such surrender, the amount of any dividends or distributions with a record date
after the Effective Date and before surrender which shall have become payable
thereon since the Effective Date, without interest; and (ii) after such
surrender, the amount of any dividends thereon with a record date after the
Effective Date and before surrender and the payment date of which shall be after
surrender, such amount to be paid on such payment date. If any certificate for
shares of Cheshire Stock is to be issued in a name other than that in which the
certificate surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the certificate so surrendered shall be
properly endorsed and otherwise be in proper form for transfer and that the
person requesting such exchange pay to the transfer agent any transfer or other
taxes required by reason of the issuance of a certificate for shares of Cheshire
Stock in any name other than that of the registered holder of the certificate
surrendered, or establish to the satisfaction of the transfer agent that such
tax has been paid or is not payable. At the Effective Date of the Merger, all
shares of Cheshire Stock which shall then be held in its treasury, if any, shall
cease to exist, and all certificates representing such shares shall be canceled.
3.4 Fractional Shares. Cheshire will not issue certificates
representing fractional shares of Cheshire Stock, upon the Merger. Rather,
fractional interests, if any, shall be rounded up to the nearest whole share.
IV. MISCELLANEOUS
4.1 This Agreement may be terminated and the proposed Merger abandoned
at any time before the Effective Date of the Merger, and whether before or after
approval of this Agreement of Merger and Plan of Merger and Reorganization by
the mutual agreement of the Board of Directors of the Constituent Corporations
abandoning this Agreement of Merger and Plan of Merger and Reorganization.
-4-
<PAGE>
4.2 On and after the Effective Date of the Merger, the officers and
directors of Pacific shall remain in such positions until their earlier
resignation or removal.
4.3 For the convenience of the parties hereto and to facilitate the
filing of this Agreement of Merger and Plan of Merger and Reorganization, any
number of counterparts hereof may be executed; and each such counterpart shall
be deemed to be an original instrument.
IN WITNESS WHEREOF, this Agreement has been executed by Cheshire
Holdings, Inc., a Delaware corporation, and Pacific Development Corporation, a
Colorado corporation, all on the date first above written.
Pacific Development Corporation
(a Colorado corporation)
s/ Gilad Gat
---------------------------
Gilad Gat, Vice-President
Cheshire Holdings, Inc.
(a Delaware corporation)
s/ Willem Oost-Lievense
----------------------------
Willem Oost-Lievense,
Chief Executive Officer
-5-
CERTIFICATE OF MERGER
OF
PACIFIC DEVELOPMENT CORPORATION
INTO
CHESHIRE HOLDINGS, INC.
Pursuant to Section 252(c) of the
State of Delaware General Corporation law
The undersigned, being the Surviving corporation, hereby sets forth as
follows:
FIRST: The name of the Surviving corporation is Cheshire Holdings,
Inc.; its State of incorporation is Delaware.
SECOND: The name of the Non-Surviving corporation is Pacific
Development Corporation; its State of incorporation is Colorado.
THIRD: An Agreement of Merger has been approved, adopted, certified,
executed and acknowledged by each constituent corporation in accordance with
Section 251 of the State of Delaware General Corporation Law.
FOURTH: The amendments or changes in the Certificate of Incorporation
of the Surviving Corporation that are to be effected by this merger are as
follows: Article I of the Certificate of Incorporation of the Surviving
Corporation is amended to read as follows:
"ARTICLE I: The name of the Surviving corporation shall be
Cheshire Distributors, Inc."
FIFTH: The executed Agreement of Merger is on file at the principal
place of business of the Surviving corporation; the address of said principal
place of business is as follows: 1599 Post Road East, Westport, Connecticut
06880.
SIXTH: A copy of the Agreement of Merger will be furnished by the
Surviving corporation on request, and without cost, to any stockholder of any
constituent corporation.
SEVENTH: The authorized capital stock of the non-surviving which is
incorporated under the laws of the state of Colorado is 100,000,000 shares of
common stock, $.001 par value.
IN WITNESS WHEREOF, this certificate is hereby executed this day of
March, 2000.
Cheshire Holdings, Inc.
By: s/ Gilad Gat
--------------------------------
Gilad Gat, Vice-President
-1-
ARTICLES OF MERGER
OF
FOREIGN AND DOMESTIC CORPORATIONS
Pursuant to the provisions of Section 7-111-107 of the Colorado
Business Corporation Act, the undersigned domestic and foreign corporations
adopt the following Articles of Merger for the purpose of merging one of such
corporations into the other of such corporations.
1. The Names of the undersigned corporations and the states under the
laws of which they are respectively organized are:
Name of Corporation State of Incorporation
------------------------------- ----------------------
Cheshire Holdings, Inc. Delaware
Pacific Development Corporation Colorado
2. The laws of the state under which such foreign corporation is
organized permit such merger.
3. The name of the Surviving corporation is Cheshire Holdings, Inc., a
Delaware corporation, and it is to be governed by the laws of the State of
Delaware. Its principal office is located at 1599 Post Road East, Westport,
Connecticut 06880.
4. The Agreement of Merger and Plan of Merger and Reorganization, which
was approved by the shareholders of the undersigned domestic corporation in the
manner prescribed by the provisions contained in Section 7-111-107 of the
Colorado Business Corporation Act, and approved by the undersigned foreign
corporation in the manner prescribed by the laws of the State of Delaware under
which it is organized, is set forth in Exhibit "A" attached hereto and
incorporated herein by this reference.
5. As to each of the undersigned corporations, the number of shares
outstanding and the designation and number of outstanding shares of each class
entitled to vote as a class on such Amendment of Merger and Plan of Merger and
Reorganization are as follows:
Number of Common
Name of Corporation Shares Outstanding
-------------------- ------------------
Cheshire Holdings, Inc. 1,000
Pacific Development Corporation 10,365,000
-1-
<PAGE>
None of the shares of a class of the domestic or foreign corporation
was entitled to vote as a class.
6. As to each of the undersigned corporations, the total number of
shares voted for and against such Agreement of Merger and Plan of Merger and
Reorganization, respectively, is as follows:
Number of Shares
-------------------------------
Name of Corporation Voted For Voted Against
- ------------------- --------- -------------
Cheshire Holdings, Inc. 1,000 -0-
Pacific Development Corporation 10,000,000 -0-
7. Cheshire Holdings, Inc., a Delaware corporation, the Surviving
Corporation, hereby: (a) agrees that it may be served with process in the State
of Colorado in any proceeding for the enforcement of any obligation of the
undersigned domestic corporation and in any proceeding for the enforcement of
the rights of a dissenting shareholder of such domestic corporation; (b)
irrevocably appoints the Secretary of State of Colorado as its agent to accept
service of process in any proceedings; and (c) agrees that it will promptly pay
to the dissenting shareholders of such domestic corporation the amount, if any,
to which they shall be entitled under the provisions of the Colorado Business
Corporation Act with respect to the rights of dissenting shareholders.
Dated: March 10, 2000
Pacific Development Corporation
(a Colorado corporation)
s/ Willem Oost-Lievense
-------------------------
Willem Oost-Lievense
Chief Executive Officer
Cheshire Holdings, Inc.
(a Delaware corporation)
s/ Gilad Gat
-------------------------
Gilad Gat, Vice-President
-2-
<PAGE>
EXHIBIT A
AGREEMENT OF MERGER AND
PLAN OF MERGER AND REORGANIZATION
Agreement of Merger and Plan of Merger and Reorganization dated March
10, 2000 by and between Cheshire Holdings, Inc. a Delaware corporation
("Cheshire"), and Pacific Development Corporation, a Colorado corporation
("Pacific") (hereinafter, the "Constituent Corporations").
WHEREAS:
1. The Board of Directors of Cheshire and Pacific have
resolved that Cheshire be merged (hereinafter called the
"merger") under and pursuant to the Colorado Corporation
Law and the Delaware General Corporation Law into a
single corporation existing under the laws of the State
of Delaware, to wit, Cheshire, which shall be the
surviving corporation (such corporation in its capacity
as such surviving corporation being sometimes referred to
herein as the "Surviving Corporation") in a transaction
qualifying as a reorganization within the meaning of
Section 368(a)(1)(F) of the Internal Revenue Code of
1986, as amended;
2. The authorized capital stock of Cheshire consists of
100,000,000 shares of capital stock with a par value of
$.001 per share (hereinafter called "Cheshire Stock"),
1,000 shares of which are issued and outstanding;
3. The authorized capital stock of Pacific consists of
100,000,000 shares of capital stock with a par value of
$.001 per share (hereinafter called "Pacific Stock")
10,365,000 shares of which are issued and outstanding;
4. The respective Boards of Directors of Cheshire and Pacific
have approved the Merger upon the terms and conditions
hereinafter set forth and have approved this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements, provisions and covenants herein contained, the parties hereto hereby
agree, in accordance with the Colorado Corporation Law and the Delaware General
Corporation Law, that Pacific shall be, at the Effective Date (as hereinafter
defined), merged into a single corporation existing under the laws of the State
of Delaware, to wit, Cheshire, which shall be the Surviving Corporation, and
which simultaneously with filing as part of the Certificate of Merger, shall
change its name to Cheshire Distributors, Inc., and the parties hereto adopt and
agree to the following agreements, terms and conditions relating to the Merger
and the mode of carrying the same into effect.
-1-
<PAGE>
1. SHAREHOLDERS' CONSENTS; FILINGS; EFFECTS OF MERGER
1.1 Action by Shareholders of Pacific. Pacific shall obtain the
approval of its shareholders, in accordance with the Colorado Corporation Law,
at the earliest practicable date, which written consent shall, among other
matters, adopt and ratify this Agreement.
1.2 Action by Pacific as Sole Shareholder of Cheshire. At the earliest
practicable date, Pacific, as the sole shareholder of Cheshire, shall adopt this
Agreement in accordance with the Colorado Revised Statutes.
1.3 Filing of Articles of Merger, Effective Date. If (a) this Agreement
is adopted by the shareholders of Cheshire, in accordance with the Delaware
General Corporation Law, (b) this Agreement has been adopted by Pacific as the
sole shareholder of Cheshire, in accordance with the Colorado Corporation Law,
and (c) this Agreement is not thereafter, and has not theretofore been
terminated or abandoned as permitted by the provisions hereof, then an Articles
of Merger shall be filed and recorded in accordance with the Colorado
Corporation Law and Articles of Merger shall be filed and recorded in accordance
with the Delaware General Corporation Law. Such filings shall be made on the
same day. The Merger shall become effective at 9:00 A.M. on the calendar day
following the day of such filing in Delaware, which date and time is herein
referred to as the "Effective Date."
1.4 Certain Effects of Merger. On the Effective Date, the separate
existence of Pacific shall cease, and Pacific shall be merged into Cheshire,
which, as the Surviving Corporation, shall possess all the rights, privileges,
powers and franchises, of a public as well as of a private nature, and be
subject to all the restrictions, disabilities and duties of each of the
Constituent Corporations; and all and singular, the rights, privileges, powers
and franchises of the Constituent Corporations, and all property, real, personal
and mixed, and all debts due to the Constituent Corporations on whatever
account, as well as for stock subscriptions and all other things in action or
belonging to such Constituent Corporations, shall be vested in the Surviving
Corporation; and all property, rights, privileges, powers and franchises, and
all and every other interest shall be thereafter as effectually the property of
the Surviving Corporation as they were of the Constituent Corporations, and the
title to any real estate vested by deed or otherwise, under the laws of Delaware
or any other jurisdiction, in any of the Constituent Corporations, shall not
revert or be in any way impaired; but all rights of creditors and all liens upon
any property of any of the Constituent Corporations shall be preserved
unimpaired, and all debts, liabilities and duties of the Constituent
Corporations shall thenceforth attach to the Surviving Corporation and may be
-2-
<PAGE>
enforced against it to the same extent as if said debts, liabilities and duties
had been incurred or contracted by it. At any time, or from time to time, after
the Effective Date, the last acting officers of Pacific, or the corresponding
officers of the Surviving Corporation may, in the name of Pacific, execute and
deliver all such proper deeds, assignments and other instruments and take or
cause to be taken all such further or other action as the Surviving Corporation
may deem necessary or desirable in order to vest, perfect or confirm in the
Surviving Corporation title to and possession of all of the Constituent
Corporations property, rights, privileges, powers, franchises, immunities and
interests and otherwise to carry out the purposes of this Agreement.
II. NAME OF SURVIVING CORPORATION; ARTICLES OF INCORPORATION; BYLAWS;
2.1 Name of Surviving Corporation. The name of the Surviving
Corporation from and after the Effective Date shall be Cheshire Distributors,
Inc.
2.2 Articles of Incorporation. The Articles of Incorporation of
Cheshire as in effect on the date hereof, shall, from and after the Effective
Date, be and continue to be the Articles of Incorporation of the Surviving
Corporation, until changed or amended as provided by law.
2.3 Bylaws. The Bylaws of Cheshire, as in effect immediately before the
Effective Date shall, from and after the Effective Date, be and continue to be
the Bylaws of the Surviving Corporation, until amended as provided therein.
III STATUS AND CONVERSION OF SECURITIES
3.1 Pacific Stock. Each share of Pacific Stock which shall be issued
and outstanding immediately before the Effective Date shall, by virtue of the
Merger and without any action on the part of the holder thereof, be converted at
the Effective Date into one (1) fully paid share of Cheshire Stock.
3.2 Cheshire Stock held by Pacific. All issued and outstanding shares
of Cheshire Stock held by Pacific immediately before the Effective Date shall,
by virtue of the Merger and at the Effective Date, cease to exist and the
certificate(s) representing such shares shall be canceled.
3.3 Surrender of Certificates. After the Effective Date, certificates
evidencing outstanding shares of Pacific Stock shall evidence the right of the
holder thereof to receive a certificate(s) for shares of Cheshire Stock as
aforesaid. Holders of certificates representing shares of Pacific Stock, upon
-3-
<PAGE>
surrender of such certificates to the transfer agent of the Cheshire Stock to
effect the exchange of certificates, shall be entitled to receive, upon such
surrender, a certificate or certificates representing a like number of shares of
Cheshire Stock. Until so surrendered, outstanding certificates for shares of
Pacific Stock shall be deemed for all corporate purposes, including voting
rights, subject to the further provisions of this Article 3, to evidence the
ownership of the shares of Cheshire Stock into which such shares of Pacific
Stock have been so converted. No dividends or distributions will be paid to the
person entitled to receive certificates for shares of Cheshire Stock pursuant
hereto until such person shall have surrendered his Pacific Stock certificates;
but there shall be paid to the record holder of such certificate, with respect
to the number of shares of Cheshire Stock issued in exchange therefor (i) upon
such surrender, the amount of any dividends or distributions with a record date
after the Effective Date and before surrender which shall have become payable
thereon since the Effective Date, without interest; and (ii) after such
surrender, the amount of any dividends thereon with a record date after the
Effective Date and before surrender and the payment date of which shall be after
surrender, such amount to be paid on such payment date. If any certificate for
shares of Cheshire Stock is to be issued in a name other than that in which the
certificate surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the certificate so surrendered shall be
properly endorsed and otherwise be in proper form for transfer and that the
person requesting such exchange pay to the transfer agent any transfer or other
taxes required by reason of the issuance of a certificate for shares of Cheshire
Stock in any name other than that of the registered holder of the certificate
surrendered, or establish to the satisfaction of the transfer agent that such
tax has been paid or is not payable. At the Effective Date of the Merger, all
shares of Cheshire Stock which shall then be held in its treasury, if any, shall
cease to exist, and all certificates representing such shares shall be canceled.
3.4 Fractional Shares. Cheshire will not issue certificates
representing fractional shares of Cheshire Stock, upon the Merger. Rather,
fractional interests, if any, shall be rounded up to the nearest whole share.
IV. MISCELLANEOUS
4.1 This Agreement may be terminated and the proposed Merger abandoned
at any time before the Effective Date of the Merger, and whether before or after
approval of this Agreement of Merger and Plan of Merger and Reorganization by
the mutual agreement of the Board of Directors of the Constituent Corporations
abandoning this Agreement of Merger and Plan of Merger and Reorganization.
-4-
<PAGE>
4.2 On and after the Effective Date of the Merger, the officers and
directors of Pacific shall remain in such positions until their earlier
resignation or removal.
4.3 For the convenience of the parties hereto and to facilitate the
filing of this Agreement of Merger and Plan of Merger and Reorganization, any
number of counterparts hereof may be executed; and each such counterpart shall
be deemed to be an original instrument.
IN WITNESS WHEREOF, this Agreement has been executed by Cheshire
Holdings, Inc., a Delaware corporation, and Pacific Development Corporation, a
Colorado corporation, all on the date first above written.
Pacific Development Corporation
(a Colorado corporation)
s/ Gilad Gat
---------------------------
Gilad Gat, Vice-President
Cheshire Holdings, Inc.
(a Delaware corporation)
s/ Willem Oost-Lievense
----------------------------
Willem Oost-Lievense,
Chief Executive Officer
-5-
<PAGE>
EXHIBIT B
Dissenter's rights
Part I
Right of Dissent - Payment for Shares
7-113-101 Definitions.-For purposes of this article:
(1) " Beneficial shareholder" means the beneficial owner of shares held in
a voting trust or by a nominee as the record shareholder.
(2) "Corporation" means the issuer of the shares held by a dissenter before
the corporation action, or the surviving or acquiring domestic or
foreign corporation, by merger or share exchange of that issuer.
(3) "Dissenter" means a shareholder who is entitled to dissent from
corporate action under section 7/113-102 and who exercises that right
at the time and in the manner required by part 2 of this article.
(1) "Fair value", with respect to a dissenter's shares, means the value of
the shares immediately before the effective date of the corporate
action to which the dissenter objects, excluding any appreciation or
depreciation in anticipation of the corporate action except to the
extent that exclusion would be inequitable.
(2) "Interest" means interest from the effective date of the corporate
action until the date of payment, at the average rate currently paid by
the corporation on its principal bank loans or, if none, at the legal
rate as specified in section 5-12-101, C.R.S.
(3) "Record shareholder" means the person in whose name shares are
registered in the records of a corporation or the beneficial owner os
shares that are registered in the name of a nominee to the extent such
owner is recognized by the corporation as the shareholder as provided
in section 7-107-204.
(4) "Shareholder" means either a record shareholder or a beneficial
shareholder.
7-133-102 RIGHT TO DISSENT.-(1) A shareholder, whether or not entitled to vote,
is entitled to dissent and obtain payment of the fair value of the shareholder's
shares in the event of any of the following corporate actions:
(a) Consummation of a plan of merger to which the corporation is a
party if:
(I) Approval by the shareholders of that corporation is required
for the merger by section 7-111-103 or 7-111-104 or by the
articles of incorporation; or
-1-
<PAGE>
(II) The corporation is a subsidiary that is merged with its parent
corporation under section 7-111-104;
(b) Consummation of a plan of share exchange to which the
corporation is a party as the corporation whose shares will be
acquired;
(c) Consummation of a sale, lease, exchange, or other disposition
of all, or substantially all, of the property of the
corporation for which a shareholder vote is required under
section 7-112-102 (1); and
(d) consummation of a sale, lease, exchange or other disposition
of all, or substantially all, of the property of an entity
controlled by the corporation if the shareholders of the
corporation were entitled to vote upon the consent of the
corporation to the disposition pursuant to section 7-112-
102(2).
(1.3) A shareholder is not entitled to dissent and obtain payment,
under subsection (1) of this section, of the fair value of the shares of any
class or series of shares which either were listed on a national securities
exchange registered under the federal "Securities Exchange Act of 1934", as
amended, or on the national market system of the National Association of
Securities Dealers Automated Quotation System, or were held of record by more
than two thousand shareholders, at the time of:
(a) The record date fixed under section 7-107-107 to determine the
shareholders entitled to receive notice of the shareholders'
meeting at which the corporate action is submitted to a vote;
(b) The record date fixed under section 7-107-104 to determine
shareholders entitled to sign writings consenting to the
corporate action; or
(c) The effective date of the corporate action if the corporate
action is authorized other than by a vote of shareholders.
(1.8) The limitation set forth in subsection (1.3) of this section
shall not apply if the shareholder will receive for the shareholder's shares,
pursuant to the corporate action, anything except:
(a) Shares of the corporation surviving the consummation of the
plan of merger or share exchange;
(b) Shares of any other corporation which at the effective date of
the plan of merger or share exchange either will be listed on
a national securities exchange registered under the federal
"Securities Act of 1934", as amended, or on the national
market system of the National Association of Securities
Dealers Automated Quotation System, or will be held of record
by more than two thousand shareholders;
-2-
<PAGE>
(c) Cash in lieu of fractional shares; or
(d) Any combination of the foregoing described shares or cash in
lieu of fractional shares.
(2.5) A shareholder, whether or not entitled to vote, is entitled to
dissent and obtain payment of the fair value of the shareholder's shares in the
event of a reverse split that reduces the number of shares owned by the
shareholder to a fraction of a share or to scrip if the fractional share or
scrip so created is to be acquired for cash or the scrip is to be voided under
section 7-106-104.
(3) A shareholder is entitled to dissent and obtain payment of the fair
value of the shareholder's shares in the event of any corporate action to the
extent provided by the bylaws or a resolution of the board of directors.
(4) A shareholder entitled to dissent and obtain payment for the
shareholder's shares under this article may not challenge the corporate action
creating such entitlement unless the action is unlawful or fraudulent with
respect tot he shareholder or the corporation.
7-113-103 DISSENT BY NOMINEES AND BENEFICIAL OWNERS.-(1) A record shareholder
may assert dissenters' rights as to fewer than all the shares registered in the
record shareholder's name only if the record shareholder dissents with respect
to all shares beneficially owned by any one person and causes the corporation to
receive written notice which states such dissent and the name, address, and
federal taxpayer identification number, if any, of each person on whose behalf
the record shareholder asserts dissenters' rights. The rights of a record
shareholder under this subsection (1) are determined as if the shares as to
which the record shareholder dissents and the other shares of the record
shareholder were registered in the names of different shareholders.
(2) A beneficial shareholder may assert dissenters' rights as to the
shares held on the beneficial shareholder's behalf only if;
(a) The beneficial shareholder causes the corporation to receive
the record shareholder's written consent to the dissent not
later than the time the beneficial shareholder asserts
dissenters' rights; and
(b) The beneficial shareholder dissents with respect to all shares
beneficially owned by the beneficial shareholder.
(3) The corporation may require that, when a record shareholder
dissents with respect to the shares held by any one or more beneficial
shareholders, each such beneficial shareholder must certify to the corporation
that the beneficial shareholder and the record shareholder or record
shareholders of all the shares owned beneficially by the beneficial shareholder
-3-
<PAGE>
have asserted, or will timely assert, dissenters' rights as to all such shares
as to which there is no limitation on the ability to exercise dissenters'
rights. Any such requirement shall be stated in the dissenters' notice given
pursuant to section 7-113-203.
PART 2
Procedure for Exercise of Dissenters' Rights
7-113-201 NOTICE OF DISSENTERS' RIGHTS.-(1) If a proposed corporate action
creating dissenters' rights under section 7-113-102 is submitted to a vote at a
shareholders' meeting, the notice of the meeting shall be given to all
shareholders, whether or not entitled to vote. The notice shall state that
shareholders are or may be entitled to assert dissenters' rights under this
article and shall be accompanied by a copy of this article and the materials, if
any, that, under articles 101 to 117 of this title, are required to be given to
shareholders entitled to vote on the proposed action at the meeting. Failure to
give notice as provided by this subsection (1) shall not affect any action taken
at the shareholders' meeting for which the notice was to have been given, but
any shareholder who was entitled to dissent but who was not given such notice
shall not be precluded from demanding payment for the shareholders' shares under
this article by reason of the shareholder's failure to comply with the
provisions of section 7-113-202(1).
(2) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is authorized without a meeting of shareholders pursuant to
section 7-101-104, any written or oral solicitation of a shareholder to execute
a writing consenting to such action contemplated in section 7-107-104 shall be
accompanied or preceded by a written notice stating that shareholders are or may
be entitled to assert dissenters' rights under this article, by a copy of this
article, and by the materials, if any, that, under articles 101 to 117 of this
title, would have been required to be given to shareholders entitled to vote on
the proposed action if the proposed action were submitted to a vote at a
shareholders' meeting. Failure to give notice as provided by this subsection (2)
shall not affect any action taken pursuant to section 7-107-104 for which the
notice was to have been given, but any shareholder who was entitled to dissent
but who was not given such notice shall not be precluded from demanding payment
for the shareholders' shares under this article by reason of the shareholder's
failure to comply with the provisions of section 7-113-202(2).
7-113-202 NOTICE OF INTENT TO DEMAND PAYMENT.-(1) If a proposed corporate action
creating dissenters' rights under section 7-113-102 is submitted to a vote at a
shareholders' meeting and if notice of dissenters' rights has been given to such
shareholder in connection with the action pursuant to section 7-113-201(1), a
shareholder who wishes to assert dissenters' rights shall:
(a) Cause the corporation to receive, before the vote is taken,
written notice of the shareholder's intention to demand
payment for the shareholder's shares if the proposed corporate
action is effectuated; and
(b) Not vote the share in favor of the proposed corporate action.
-4-
<PAGE>
(2) If a proposed corporate action creating dissenters' rights under
section 7-113-102 is authorized without a meeting of shareholders pursuant to
section 7-107-104 and if notice of dissenters' rights has been given to such
shareholder in connection with the action pursuant to section 7-113-201(2) a
shareholder who wishes to assert dissenters' rights shall not execute a writing
consenting to the proposed corporate action.
(3) A shareholder who does not satisfy the requirements of subsection
(1) or (2) of this section is not entitled to demand payment for the
shareholder's shares under this article.
7-113-203 DISSENTERS' NOTICE.-(1) If a proposed corporate action creating
dissenters' rights under section 7-113-102 is authorized, the corporation shall
give a written dissenters' notice to all shareholders who are entitled to demand
payment for their shares under this article.
(2) The dissenters' notice required by subsection (1) of this section
shall be given no later than ten days after the effective date of the corporate
action creating dissenters' rights under section 7-113-102 and shall:
(a) State that the corporate action was authorized and state the
effective date or proposed effective date of the corporate
action;
(b) state an address at which the corporation will receive payment
demands and the address of a place where certificates for
certificated shares must be deposited;
(c) Inform holders of uncertificated shares to what extent
transfer of the shares will be restricted after the payment
demand is received;
(d) Supply a form for demanding payment, which form shall request
a dissenter to state an address to which payment is to be
made;
(e) Set the date by which the corporation must receive the payment
demand and certificates for certificated shares, which date
shall not be less than thirty days after the date the notice
required by subsection (1) of this section is given;
(f) State the requirement contemplated in section 7-113-103(3), if
such requirement is imposed; and
(g) Be accompanied by a copy of this article.
7-113-204 PROCEDURE TO DEMAND PAYMENT.-(1) A shareholder who is given a
dissenters' notice pursuant to section 7-113-203 and who wishes to assert
dissenters' rights shall, in accordance with the terms of the dissenters'
notice:
-5-
<PAGE>
(a) Cause the corporation to receive a payment demand, which may
be the payment demand form contemplated in section 7-113-203
(2)(d), duly completed, or may be stated in another writing
and;
(b) Deposit the shareholder's certificates for certificated
shares.
(2) A shareholder who demands payment in accordance with subsection (1)
of this section retains all rights of a shareholder, except the right to
transfer the shares, until the effective date of the proposed corporate action
giving rise to the shareholder's exercise of dissenters' rights and has only the
right to receive payment for the shares after the effective date of such
corporate action.
(3) Except as provided in section 7-113-207 or 7-113-209(1)(b), the
demand for payment and deposit of certificates are irrevocable.
(4) A shareholder who does not demand payment and deposit the
shareholder's share certificates as required by the date or dates set in the
dissenters' notice is not entitled to payment for the shares under this article.
7-113-205 UNCERTIFICATED SHARES.-(1) Upon receipt of a demand for payment under
section 7-113-204 from a shareholder holding uncertificated shares, and in lieu
of the deposit of certificates representing the shares, the corporation may
restrict the transfer thereof.
(2) In all other respects, the provisions of section 7-113-204 shall be
applicable to shareholders who own uncertificated shares.
7-113-206. PAYMENT.-(1) Except as provided in section 7-113-208, upon the
effective date of the corporate action creating dissenters' rights under section
7-113-1-2 or upon receipt of a payment demand pursuant to section 7-113-204,
whichever is later, the corporation shall pay each dissenter who complied with
section 7-113-204, at the address stated in the payment demand, or if no such
address is stated in the payment demand, at the address shown on the
corporation's current record of shareholders for the record shareholder holding
the dissenter's shares, the amount the corporation estimates to be the fair
value of the dissenter's shares, plus accrued interest.
(2) The payment made pursuant to subsection (1) of this section shall
be accompanied by:
(a) The corporation's balance sheet as of the end of its most
recent fiscal year or, if that is not available, the
corporation's balance sheet as of the end of a fiscal year
ending not more than sixteen months before the date of
payment, an income statement for that year, and, if the
corporation customarily provides such statements to
shareholders, a statement of changes in shareholders' equity
for that year and a statement of cash flow for that year,
which balance sheet and statements shall have been audited if
the corporation customarily provides audited financial
statements to shareholders, as well as the latest available
financial statements, if any, for the interim or full-year
period, which financial statements need not be audited;
-6-
<PAGE>
(b) A statement of the corporation's estimate of the fair value of
the shares;
(c) An explanation of how the interest was calculated;
(d) A statement of the dissenter's right to demand payment under
section 7-113-209; and
(e) A copy of this article.
7-113-207 FAILURE TO TAKE ACTION.-(1) If the effective date of the corporate
action creating dissenters' rights under section 7-113-102 does not occur within
sixty days after the date set by the corporation by which the corporation must
receive the payment demand as provided in section 7- 113-203, the corporation
shall return the deposited certificates and release the transfer restrictions
imposed on uncertificated shares.
(2) If the effective date of the corporate action creating dissenters'
rights under section 7-113- 102 occurs more than sixty days after the date set
by the corporation by which the corporation must receive the payment demand as
provided in section 7-113-203, then the corporation shall send a new dissenters'
notice, as provided in section 7-113-203, and the provisions of section
7-113-204 to 7- 113-209 shall again be applicable.
7-113-208 SPECIAL PROVISIONS RELATING TO SHARES ACQUIRED AFTER ANNOUNCEMENT OF
PROPOSED CORPORATE ACTION.-(1) The corporation may, in or with the dissenters'
notice given pursuant to section 7-113-203, state the date of the first
announcement to news media or to shareholders of the terms of the proposed
corporate action creating dissenters' rights under section 7-113-102 and state
that the dissenter shall certify in writing, in or with the dissenter's payment
demand under section 7-113-204, whether or not the dissenter (or the person on
whose behalf dissenters' rights are asserted) acquired beneficial ownership of
the shares before that date. With respect to any dissenter who does not so
certify in writing, in or with the payment demand, that the dissenter or the
person on whose behalf the dissenter asserts dissenters' rights acquired
beneficial ownership of the shares before such date, the corporation may, in
lieu of making the payment provided in section 7-113-206, offer to make such
payment if the dissenter agrees to accept it in full satisfaction of the demand.
(2) An offer to make payment under subsection (1) of this section shall
include or be accompanied by the information required by section 7-113-206(2).
7-113-209 PROCEDURE IF DISSENTER IS DISSATISFIED WITH PAYMENT OR OFFER.-(1)
A dissenter may give notice to the corporation in writing of the dissenter's
estimate of the fair value of the dissenter's shares and of the amount of
interest due and may demand payment of such estimate, less any payment made
under section 7-113-206, or reject the corporation's offer under section
7-113-208 and demand payment of the fair value of the shares and interest due,
if:
-7-
<PAGE>
(a) The dissenter believes that the amount paid under section
7-113-206 or offered under section 7-113-208 is less than the
fair value of the shares or that the interest due was
incorrectly calculated;
(b) The corporation fails to make payment under section 7-113-206
within sixty days after the date set by the corporation by
which the corporation must receive the payment demand; or
(c) The corporation does not return the deposited certificates or
release the transfer restrictions imposed on uncertificated
shares as required by section 7-113-207(1).
(2) A dissenter waives the right to demand payment under this section
unless the dissenter causes the corporation to receive the notice required by
subsection (1) of this section within thirty days after the corporation made or
offered payment for the dissenter's shares.
-8-
