RESCISSION AGREEMENT
THIS RESCISSION AGREEMENT (the "Rescission
Agreement") is made and entered into this 22nd day of
November, 1996, by and between Rako Corporation, an
Idaho corporation (hereinafter "Rako"), now known as
Xxxxxxx Entertainment, Inc.. pursuant to an amendment to
the Articles of Incorporation; and Xxxxxxx
Entertainment, Inc., a California corporation
(hereinafter "Xxxxxxx").
WHEREAS, the parties hereto previously entered into
and executed that certain Acquisition Agreement and Plan
of Reorganization dated the 9th day of May, 1996 (the
"Acquisition Agreement"), a copy of which is annexed
hereto as Exhibit "A" and by this reference made a part
hereof; and
WHEREAS, the parties hereto now desire to rescind
the Acquisition Agreement and revoke the terms and
conditions set forth therein and transfer and return to
their prior respective owners all assets and property
that may have been transferred pursuant to the terms of
the Acquisition Agreement.
NOW, THEREFORE, in consideration of the mutual
representations and covenants herein contained, the
parties hereby agree as follows:
1. The parties to this Rescission Agreement hereby
individually and jointly agree that the Acquisition
Agreement shall be rescinded and deemed null and void,
effective immediately, and that all terms, conditions,
covenants, representations and warranties contained in
said Acquisition Agreement shall terminate immediately
and shall be deemed null and void and of no further
effect whatsoever.
2. Xxxxxxx agrees that as consideration for the
execution of this Rescission Agreement, it shall,
together with its former shareholders, relinquish and
forever waive any ownership claim or right to the
6,300,000 shares of Rako common stock issued to the
shareholders of Xxxxxxx or their designees pursuant to
the terms of the Acquisition Agreement, and Xxxxxxx
agrees to return to Rako all 6,300,000 shares to be
canceled on the stock transfer records of Rako. Rako
also agrees that as consideration for the execution of
this Rescission Agreement, it shall relinquish and
forever waive any ownership claim or right to the
Xxxxxxx capital stock that was to be delivered to Rako
as consideration for the issuance of Rako common stock
pursuant to the terms of the Acquisition Agreement, but
which share were never delivered..
3. All parties to this Rescission Agreement hereby
agree that any and all assets, property, securities or
items of value that may have been assigned or
transferred pursuant to the terms of the Acquisition
Agreement are to be, immediately upon the execution of
this Rescission Agreement, transferred and reconveyed to
the respective parties that assigned and/or transferred
such items under the terms of the Acquisition Agreement,
and that each party shall be returned to its same
position as immediately prior the execution of the
Acquisition Agreement.
4. Xxxxxxx represents and warrants that there have
been no debts or liabilities incurred by it in the name
of or which encumbered the Rako corporate entity between
the date of the Acquisition Agreement and the date
hereof and, in the event any such debt and/or liability
has been incurred during such time period, Xxxxxxx
agrees to assume and become obligated to any such debt
and/or liability. Xxxxxxx further agrees to indemnify
and hold harmless Rako against any debt, liability or
other obligation that may have been incurred by Xxxxxxx
between the date of the Acquisition Agreement and the
date hereof.
5. Rako represents and warrants that there have
been no debts or liabilities incurred by it in the name
of or which encumbered the Xxxxxxx corporate entity
between the date of the Acquisition Agreement and the
date hereof and, in the event any such debt and/or
liability has been incurred during such time period,
Rako agrees to assume and become obligated to any such
debt and/or liability. Rako further agrees to indemnify
and hold harmless Xxxxxxx against any debt, liability or
other obligation that may have been incurred by Rako
between the date of the Acquisition Agreement and the
date hereof.
6. Immediately prior to the execution of this
Rescission Agreement, those current directors of Rako
who were nominated by Xxxxxxx and became directors of
Rako, specifically Xxxxxx Xxxxxx, Xxxxxx Xxxxxx, Xxxxxxx
X. Xxxxxxxxx, Xxxxxxx Xxx and Xxxxxx Xxxxx, shall cause
the appointment of at least three new directors, to be
designated by Rako, and each current director shall then
tender his written resignations from the Rako Board of
Directors. Such resignations shall be effective the
date hereof and shall be annexed hereto as Exhibits and
become a part of this Rescission Agreement.
7. All parties hereto shall bear their respective
costs and expenses associated with the Acquisition
Agreement and this Rescission Agreement.
8. This Rescission Agreement shall be governed by
the laws of the State of Idaho. Any action to enforce
the provisions of this Agreement shall be brought within
the State of Idaho and in no other place.
9. This Rescission Agreement may be executed in
one or more counterparts, each of which shall be deemed
an original and together shall constitute one document.
The delivery by facsimile of an executed counterpart of
this Rescission Agreement shall be deemed to be an
original and shall have the full force and effect of an
original executed copy.
IN WITNESS WHEREOF, the parties hereto have executed
and delivered this Rescission Agreement in a manner
legally binding upon them as of the date first written
above.
"Rako"
RAKO CORPORATION Attest:
(nka Xxxxxxx Entertainment, Inc.)
By:__________________________
___________________________
Its: President Secretary
"Xxxxxxx"
XXXXXXX ENTERTAINMENT, INC. Attest:
By:___________________________
___________________________
Its: President Secretary
