Exhibit No. 2 Agreement and Plan of Exchange between Global Foods
Online, Inc. and Majestic Modular Buildings, Ltd.
AGREEMENT AND PLAN OF EXCHANGE
This Agreement and Plan of Exchange ("Agreement") between Global
Foods Online, Inc., a Nevada corporation ("Global"), and Majestic
Modular Buildings, Ltd., a Maryland corporation ("Modular" or
"Acquired Corporation"), wholly-owned subsidiary of The Majestic
Companies, Ltd., a Nevada Corporation, the two corporations, Global
and Modular, acting by their respective boards of directors and
sometimes collectively referred to as the "Constituent Corporations,"
is entered into this 9th day of November 2001, and will have an
effective date as set forth in Article I, Section 2 hereafter.
WHEREAS, Global is a corporation organized and existing under
the laws of the State of Nevada, having been originally incorporated
on September 14, 1990, with its principal business office located at
000 Xxxxx Xxxxx Xxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000;
WHEREAS, the authorized capital stock of Global consists of
Fifty Million (50,000,000) shares of common stock, par value of
$0.001 per share, of which Eleven Million Fifty-Seven Thousand Three
Hundred Forty-Two (11,057,342) shares are presently issued and
outstanding.
WHEREAS, Nevada Revised Statutes 92A.110 confers upon Global the
power to acquire all of the outstanding owner's interests of one or
more classes or series of another entity not already owned by it, and
Nevada Revised Statutes 92A.250 confers upon Global the right to
issue its own shares in exchange for shares of another corporation;
WHEREAS, Modular is a corporation organized and existing under
the laws of the State of Maryland, with its principal business office
located at 000 Xxxxx Xxxxxx, Xxxxxxx, XX 00000;
WHEREAS, Modular is a wholly-owned subsidiary of The Majestic
Companies, Ltd., a Nevada Corporation, which owns all one hundred
(100) shares of common stock, par value of $0.001 per share;
WHEREAS, Modular is a fully operational business that builds
modular
classrooms for schools. Modular needs to have capital and assets
available to be able to complete its outstanding building contracts;
WHEREAS Global has received a commitment from an investment
group to fund Global with an equity line of credit in an amount not
to exceed Three Million Dollars ($3,000,000) over a twenty-four (24)
month period;
WHEREAS, concurrent with this Agreement, an Agreement and Plan
of Exchange is being consummated between Lutrex Enterprises, Inc. and
Global such that neither acquisition is a predecessor agreement
between Global and either of the two acquired companies, Modular or
Lutrex Enterprises, Inc.;
WHEREAS, the respective boards of directors of Global and
Modular deem it desirable and in the best interests of the
corporations and their stockholders that the corporations enter into
this Agreement pursuant to the terms and conditions contained herein;
and
WHEREAS, in order to consummate this exchange and in
consideration of the mutual benefits to be derived and the mutual
agreements contained herein, Global and Modular approve and adopt
this Agreement.
NOW, THEREFORE, in consideration of the promises and mutual
agreements, provisions and covenants herein contained, it is agreed
by and between the parties that, in accordance with the provisions of
the laws of the State of Nevada, there shall be an exchange of
interest between Global and Modular as of the Effective Date (as
defined in Article I, Section 2 hereafter) with Modular being a
subsidiary of Global, all on the terms and conditions set forth as
follows:
ARTICLE I
EXCHANGE OF INTEREST
1. Shareholder Approval.
This Agreement has been submitted to the shareholders of the
each of the Constituent Corporations as provided for in accordance
with the Nevada Revised Statutes and has been adopted by receiving
the affirmative vote of the holders of a majority of the common stock
of the Constituent Corporations. As this Agreement has been so
approved and adopted, Global and Modular shall immediately proceed to
effectuate the exchange of interest between Global and Modular.
2. Filings After Shareholder Approval.
As soon as practicable after all other conditions to the
obligations of the parties to this agreement to the effect the
exchange of interest shall have been satisfied or waived, Global
shall file with the Nevada Secretary of State a duly executed
Articles of Exchange, as required by Nevada Revised Statutes 92A.200,
and take such other and future actions as may be required by Nevada
law to make the exchange of interest effective. The exchange of
interest between Global and Modular shall become effective upon the
filing of the Articles of Exchange with the Nevada Secretary of State
("Effective Date").
3. Effect of Exchange of Interest.
When the exchange takes effect, the owner's interests of Modular
are exchanged as provided in this Agreement, and the former holders
of the owner's interests are entitled only to the rights provided in
the Articles of Exchange or any rights created pursuant to NRS
92A.300 to 92A.500, inclusive.
ARTICLE II
NAME AND CONTINUED CORPORATE EXISTENCE
OF ACQUIRED CORPORATION
The corporate name of Modular, the acquired corporation, whose
corporate existence will survive this exchange as a wholly-owned
subsidiary of Global and continue thereafter, and its identity,
existence, purposes, powers, objects, franchises, rights and
immunities shall continue unaffected and unimpaired by the exchange
of interest.
ARTICLE III
DIRECTORS AND OFFICERS
OF ACQUIRED CORPORATION; INTERIM MANAGEMENT
1. Officers/Directors.
The current Board of Directors and Officers of Modular shall
resign upon the Effective Date. As a wholly-owned subsidiary of
Global, Global shall appoint the new officers and/or directors of
Modular as soon as practicable, and until such time, the following
individuals shall be interim Officers/Directors:
Xxxxxx Xxxxxx
The number of directors of the Acquired Corporation shall be
three (3) until changed by action of the Board of Directors of the
Acquired Corporation pursuant to its bylaws. If, on or after the
Effective Date, a vacancy shall for any reason exist in the Board of
Directors of the Acquired Corporation, or in any of the offices, the
vacancy shall be filled in the manner provided in the certificate of
incorporation of Global or in its bylaws.
2. Annual Meeting.
The first annual meeting of the shareholders of the Acquired
Corporation after the Effective Date shall be the annual meeting
provided by the bylaws of Global for the year 2002.
3. Management Agreement - Modular. Upon the signing of the
Agreement, the following management agreement will become effective:
a. Beginning Tuesday, November 6, 2001, and continuing until
the closing of this transaction, Xxxx Xxxxxxxx will become the
manager of Modular in Modesto, California, with power to hire, fire
and otherwise operate the business operations and manufacturing
activities.
b. Modular will fund all of its business operations during
such management period.
c. Xxxx Xxxxxxxx will be compensated, in arrears, for such
management activities at the same rate he is subsequently employed by
Lutrex, a subsidiary of Global. In the event this transaction is not
consummated, Xxxx Xxxxxxxx will be paid a management fee of
$10,000.00 per month or portion thereof that he acts as the Modular
manager.
ARTICLE IV
CAPITAL STOCK OF ACQUIRED CORPORATION
The capitalization of the Acquired Corporation upon the
Effective Date shall be as set forth in the certificate of
incorporation of Modular.
ARTICLE V
EXCHANGE OF SHARES/ ISSUANCE OF NOTE PAYABLE
Global shall issue to The Majestic Companies, Ltd. a total of
Twenty-Eight Million, Five Hundred Thousand shares of the common
stock, par value of $0.001 per share of Global, such that, for each
of the One Hundred shares of Modular currently outstanding, there
will be Two Hundred Eighty-Five Thousand shares of Global issued to
The Majestic Companies, Ltd. It is understood that The Majestic
Companies, Ltd. will thereafter issue a dividend to its shareholders
of record the Twenty-Eight Million, Five Hundred Thousand shares of
the common stock of Global in a pro-rata distribution.
Global will sign a note payable to The Majestic Companies, Ltd.
for Nine Hundred Thousand Dollars ($900,000.00), payable over a
sixteen (16) month period. That period shall commence twenty days
after the filing of the Schedule 14C ("Effective Date") and the
inclusion of the acquisition agreements between the two wholly-owned
subsidiaries under the following structure: First payment, due on the
(Effective date), $10,000.00; Second payment, due one month after the
Effective date, $20,000.00; Third payment, due two months after the
Effective date, $30,000.00; Fourth payment, due three months after
the Effective date, $40,000.00; Fifth payment, due four months after
the Effective date, $50,000.00; Sixth payment, due five months after
the Execution date, $50,000.00; and for the remaining ten (10) more,
payments of $70,000.00 on each month thereafter after the date of the
Effective date. It is understood that in any month whereby Global
cannot make the payment without impairing working capital, Global may
elect to make all or any portion of the payment in stock of Global at
the bid price on the date the payment is due.
ARTICLE VI
ASSETS AND LIABILITIES
On the Effective Date, all property, real, personal and mixed,
and all debts due to either of the Constituent Corporations on
whatever account, as well for stock subscriptions as all other choses
in action, and all and every other interest of or belonging to either
of Constituent Corporations shall remain with each of the Constituent
Corporations, and the title to any real estate or any interest,
whether vested by deed or otherwise, in either of the Constituent
Corporations shall not revert or be in any way impaired by reason of
the exchange; provided, however, that all rights of creditors and all
liens upon the property of either of the Constituent Corporations
shall be preserved unimpaired, and any debts, liabilities,
obligations and duties of the respective Constituent Corporations
shall remain with each of them. The parties respectively agree that
from time to time, when requested by either party or by its
successors or assigns, they will execute and deliver or cause to be
executed and delivered all deeds and instruments, and will take or
cause to be taken all further or other action, as either party may
deem necessary or desirable in order to vest in and confirm to each
of the respective parties or its successors or assigns title to and
possession of all the property and rights and otherwise carry out the
intent and purposes of this Agreement.
ARTICLE VII
CONDUCT OF BUSINESS BY CONSTITUENT CORPORATIONS
Prior to the Effective Date, Modular shall conduct its business
in its usual and ordinary manner, and shall not enter into any
transaction other than in the usual and ordinary course of such
business except as provided. Without limiting the generality of the
above, Modular shall not, except as otherwise consented to in writing
by Global or as otherwise provided in this Agreement:
1. Issue or sell any shares of its capital stock in addition to
those outstanding on this date, except shares issued pursuant to
rights or options outstanding at that date;
2. Issue rights to subscribe to or options to purchase any shares
of its stock in addition to those outstanding on this date;
3. Amend its certificate of incorporation or its bylaws;
4. Issue or contract to issue funded debt;
5. Declare or pay any dividend or make any other distribution upon
or with respect to its capital stock.
6. Repurchase any of its outstanding stock or by any other means
transfer any of its funds to its shareholders either selectively or
rateably, in return for value or otherwise, except as salary or other
compensation in the ordinary or normal course of business;
7. Undertake or incur any obligations or liabilities except current
obligations or liabilities in the ordinary course of business and
except for liabilities for fees and expenses in connection with the
negotiation and consummation of the merger in amounts to be
determined after the Effective Date;
8. Mortgage, pledge, subject to lien or otherwise encumber any
realty or any tangible or intangible personal property;
9. Sell, assign or otherwise transfer any tangible assets of
whatever kind, or cancel any claims, except in the ordinary course of
business;
10. Sell, assign, or otherwise transfer any trademark, trade name,
patent or other intangible asset;
11. Default in performance of any material provision of any material
contract or other obligation;
12. Waive any right of any substantial value; or
13. Purchase or otherwise acquire any equity or debt security of
another corporation except to realize on an otherwise worthless debt.
ARTICLE VIII
WARRANTIES OF THE CONSTITUENT CORPORATIONS
1. Representations and Warranties of Modular.
Modular covenants, represents and warrants to Global that:
a. It is on the date of this Agreement, and will be on the
Effective Date, (a) a corporation duly organized and existing and in
good standing under the laws of the jurisdiction of the State of
Maryland, (b) duly authorized under its articles, and under
applicable laws, to engage in the business carried on by it, and (c)
it is fully qualified to do business in the State of California;
b. Its Board of Directors and its stockholders have authorized and
approved the execution and delivery of this Agreement, and the
performance of the transactions contemplated by this Agreement.
c. It has complied with, and is not in violation of any applicable
Federal, State, or local statutes, laws, and regulations affecting
its properties or the operation of its business.
d. The execution and delivery of this Agreement and its performance
in the time and manner contemplated will not cause, constitute, or
conflict with, or result in any of the following: (1) a breach or
violation of any provisions of or constitute a default under any
license, indenture, mortgage instrument, article of incorporation,
bylaw, other agreement or instrument to which the company is a party,
or by which it may be bound, nor will any consents or authorizations
of any party other than those required or (2) any event that would
permit any party to any agreement or instrument to terminate it or to
accelerate the maturity of any indebtedness or other obligation of
the company.
e. It will use its best efforts to collect the accounts receivable
owned by it and will follow its past practices in connection with the
extension of any credit prior to the Effective Date;
f. All fixed assets owned by it and employed in its business are of
the type, kind and condition appropriate for its business and will be
operated in the ordinary course of business until the Effective Date;
g. It has not been represented by any broker in connection with the
transaction contemplated, except as it has advised Global in writing;
and
h. Modular, in addition to other action which is has covenanted,
represented, and warranted to Global that it shall take, shall also:
(1) Use its best efforts to preserve its business organization
intact, to keep available to Global the present employees of
Modular, and to preserve for Global the relationships of Modular
with suppliers and customers and others having business
relations with Modular; and
2. Representations and Warranties of Global.
Global covenants, represents and warrants to Modular that:
a. It is on the date of this Agreement, and will be on the
Effective Date, (a) a corporation duly organized and existing and in
good standing under the laws of the jurisdiction of the State of
Nevada, (b) duly authorized under its articles, and under applicable
laws, to engage in the business carried on by it, and (c) it is fully
qualified to do business in the State of California;
b. Its Board of Directors and its shareholders have authorized and
approved the execution and delivery of this Agreement, and the
performance of the transactions contemplated by this Agreement, and
is a legal, valid, and binding obligation of the company, and is
enforceable in accordance with its terms and conditions.
c. It has complied with, and is not in violation of any applicable
Federal, State, or local statutes, laws, and regulations affecting
its properties or the operation of its business.
d. The execution and delivery of this Agreement and its performance
in the time and manner contemplated will not cause, constitute, or
conflict with, or result in any of the following: (1) a breach or
violation of any provisions of or constitute a default under any
license, indenture, mortgage instrument, article of incorporation,
bylaw, other agreement or instrument to which the company is a party,
or by which it may be bound, nor will any consents or authorizations
of any party other than those required or (2) any event that would
permit any party to any agreement or instrument to terminate it or to
accelerate the maturity of any indebtedness or other obligation of
the company.
e. It will use its best efforts to collect the accounts receivable
owned by it and will follow its past practices in connection with the
extension of any credit prior to the Effective Date;
f. All fixed assets owned by it and employed in its business are
of the type, kind and condition appropriate for its business and will
be operated in the ordinary course of business until the Effective
Date;
g. It has not been represented by any broker in connection with the
transaction contemplated, except as it has advised Global in writing;
h. It is a fully reporting company under the Securities Exchange
Act of 1934, and is current in all its reporting requirements;
i. Its common stock is listed and trading on the Over the Counted
Bulletin Board (under the trading symbol "GFDO") and no restrictions
have been imposed on the trading of these shares by the National
Association of Securities Dealers, Inc. or any other regulatory body;
and
j. Global represents that there are no outstanding options,
warrants or other instruments currently in existence that would
entitle anyone to acquire new shares of Global. In the event any
such instruments are found, the shareholders that were diluted by
such instruments will receive additional shares to offset such
entitlements. The purpose of this provision is to assure that after
the Modular and Lutrex acquisitions are completed, the shareholders
of both the subsidiaries will maintain the percentages contemplated
by the acquisitions of both subsidiaries, Twenty-Seven percent and
Fifty-Nine percent, respectively.
ARTICLE IX
CONSUMMATION OF EXCHANGE
Notwithstanding shareholder authorization and at any time prior
to the filing, the filing and recording of this Agreement may be
deferred from time to time by mutual consent of the respective boards
of directors of each of the Constituent Corporations, and, to the
extent provided below, the merger may be abandoned:
1. At the election of the Board of Directors of either Constituent
Corporation if:
a. The warranties and representations of the other Constituent
Corporation contained in this Agreement shall not be substantially
accurate in all material respects on and as of the Effective date; or
the covenants contained of the other Constituent Corporation shall
not have been performed or satisfied in all material respects; or
b. Prior to the merger (1) there shall have been filed in any court
or agency having jurisdiction a complaint or other proceeding seeking
to restrain or enjoin the merger contemplated hereby.
ARTICLE X
POST EXECUTION, PRE EXCHANGE
It is understood that upon execution of this Agreement, and
concurrent with the execution of the agreement between Global and
Lutrex Enterprises, Inc., counsel for Global will file a Schedule 14C
and as a result of that filing, the corporate action contemplated by
this transaction will not take place until twenty (20) days
thereafter. After the execution of this Agreement, and during that
twenty-day period, nothing shall cause this Agreement to be void,
voidable or invalid.
ARTICLE XI
MISCELLANEOUS
1. Access to Books and Records.
To enable Global to coordinate the activities of Modular with
those of Global on and after the Effective Date, Modular shall,
before the Effective Date, afford to the officers and authorized
representatives of Global free and full access to the plants,
properties, books and records of Modular, and the officers of Modular
will furnish Global with financial and operating data and other
information as to the business and properties of Modular as Global
shall from time to time reasonably request. Global shall, before the
Effective Date, afford to the officers and authorized representatives
of Modular such access, and Global's officers will furnish such data
and information to Modular, as may be reasonably required by Modular
for the preparation of its proxy statement in connection with the
meeting of shareholders to be called pursuant to section 1 of Article
I of this Agreement. Global and Modular agree that, unless and until
the merger contemplated by this Agreement has been consummated,
Global and Modular and their officers and representatives will hold
in strict confidence all data and information obtained from one
another as long as it is not in the public domain, and if the merger
provided for is not consummated as contemplated, Global and Modular
will each return to the other party all data as the other party may
reasonably request.
2. Rights Cumulative; Waivers.
The rights of each of the parties under this Agreement are
cumulative. The rights of each of the parties hereunder shall not be
capable of being waived or varied other than by an express waiver or
variation in writing. Any failure to exercise or any delay in
exercising any of such rights shall not operate as a waiver or
variation of that or any other such right. Any defective or partial
exercise of any of such rights shall not preclude any other or
further exercise of that or any other such right. No act or course
of conduct or negotiation on the part of any party shall in any way
preclude such party from exercising any such right or constitute a
suspension or any variation of any such right.
3. Benefit; Successors Bound.
This Agreement and the terms, covenants, conditions, provisions,
obligations, undertakings, rights, and benefits hereof, shall be
binding upon, and shall inure to the benefit of, the undersigned
parties and their heirs, executors, administrators, representatives,
successors, and permitted assigns.
4. Entire Agreement.
This Agreement contains the entire agreement between the parties
with respect to the subject matter hereof. There are no promises,
agreements, conditions, undertakings, understandings, warranties,
covenants or representations, oral or written, express or implied,
between them with respect to this Agreement or the matters described
in this Agreement, except as set forth in this Agreement. Any such
negotiations, promises, or understandings shall not be used to
interpret or constitute this Agreement.
5. Assignment.
Neither this Agreement nor any other benefit to accrue hereunder
shall be assigned or transferred by either party, either in whole or
in part, without the written consent of the other party, and any
purported assignment in violation hereof shall be void.
6. Amendment.
This Agreement may be amended only by an instrument in writing
executed by all the parties hereto.
7. Severability.
Each part of this Agreement is intended to be severable. In the
event that any provision of this Agreement is found by any court or
other authority of competent jurisdiction to be illegal or
unenforceable, such provision shall be severed or modified to the
extent necessary to render it enforceable and as so severed or
modified, this Agreement shall continue in full force and effect.
8. Section Headings.
The Section headings in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
9. Construction.
Unless the context otherwise requires, when used herein, the
singular shall be deemed to include the plural, the plural shall be
deemed to include each of the singular, and pronouns of one or no
gender shall be deemed to include the equivalent pronoun of the other
or no gender.
10. Further Assurances.
In addition to the instruments and documents to be made,
executed and delivered pursuant to this Agreement, the parties hereto
agree to make, execute and deliver or cause to be made, executed and
delivered, to the requesting party such other instruments and to take
such other actions as the requesting party may reasonably require to
carry out the terms of this Agreement and the transactions
contemplated hereby.
11. Notices.
Any notice which is required or desired under this Agreement
shall be given in writing and may be sent by personal delivery or
either United States mail, postage prepaid, or Federal Express or
similar generally recognized overnight carrier.
12. Arbitration; Venue; Governing Law.
This agreement shall be deemed to be made, governed by,
interpreted under and construed in all respects in accordance with
the commercial rules of Judicial Arbitration and Mediation Service
("JAMS"). This chosen jurisdiction is irrespective of the country or
place of domicile or residence of either party. In the event of
controversy arising out of the interpretation, construction,
performance or breach of this agreement, the parties hereby consent
to adjudication under the commercial rules of JAMS. Said venue of
the arbitration shall be in Orange County, California. Judgment on
the award rendered by the arbitrator may be entered in any federal or
state court in Orange County, California. This Agreement shall be
construed and enforced under, in accordance with, and governed by,
the laws of the State of Nevada.
13. Consents.
The person signing this Agreement on behalf of each party hereby
represents and warrants that he has the necessary power, consent and
authority to execute and deliver this Agreement on behalf of such
party.
14. Termination of Agreement.
This Agreement shall terminate on the Effective Date unless all
actions required under this Agreement have not been fully performed.
15. Survival of Provisions.
The representations and warranties contained in Article VIII of
this Agreement and any liability of one Constituent Corporation to
the other for any default under the provisions of Articles IX of this
Agreement, shall expire with, and be terminated and extinguished by,
the merger under this Agreement on the Effective Date.
16. Execution in Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original and all of which together
shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the date first above written.
GLOBAL:
By:/s/ Xxxx Xxxxxxxx
Xxxx Xxxxxxxx, President
MODULAR:
By:/s/ Xxxxxx Xxxxxx
Xxxxxx Xxxxxx, President
