EXCHANGE AGREEMENT
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THIS EXCHANGE AGREEMENT made and entered into this 26th day of
January, 1998, by and between Xxxxx X. Xxxxxx, (hereinafter "Hunter") the
Exchange Agent for the Stockholders of NextGen Systems, Inc. a Pennsylavania
corporation (hereinafter "NextGen"), and Royal American Mining Properties, Ltd.,
a Nevada corporation, (hereinafter "Royal").
WITNESSETH:
WHEREAS, Hunter as Exchange Agent represents that Stockholders
are the owners of all the outstanding stock of NextGen whose unaudited balance
sheet and financial statement for the period ended December 31, 1997 is attached
hereto as Exhibit "A" and incorporated herein by the reference; and
WHEREAS, the authorized capital stock of Royal consists of
100,000,000 shares of common stock, par value $0.001 per share, of which 479,000
shares are issued and outstanding; and
WHEREAS, Hunter and Royal agree that it would be to their
mutual benefit for Royal to acquire all of the outstanding stock of NextGen in
exchange for shares of Royal stock.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants herein contained, the parties hereto hereby agree as follows:
1. [REPRESENTATIONS OF THE EXCHANGE AGENT HUNTER FOR THE
STOCKHOLDERS OF NEXTGEN] Hunter hereby represents to Royal that to the best of
his knowledge:
(a) NextGen owns on the date hereof, and on the
Closing Date hereinafter provided will own, free and clear of all liens, charges
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and encumbrances, all of the assets set forth on Exhibit "A".
(b) Hunter has heretofore furnished to Royal copies
of the balance sheet of NextGen which is attached hereto and marked Exhibit "A".
Said balance sheet accurately sets forth the financial condition of NextGen as
of said date, prepared in conformity with generally accepted accounting
principles consistently applied.
(c) NextGen has good and marketable title to all of
their property and assets (except property and assets disposed of since such
date in the usual and ordinary course of business), subject to no mortgage,
pledge, lien or other encumbrance except as disclosed in such financial
statements.
(d) NextGen has no obligations, liabilities or
commitments, contingent or otherwise, of a material nature which were not
provided for, except as set forth in Exhibit "A".
(e) NextGen is not a party to any employment
contract, or to any lease, agreement or other commitment not in the usual and
ordinary course of business, nor to any operation, insurance, profit-sharing or
bonus plan, except as disclosed in Exhibit "A".
(f) NextGen is not a defendant, nor a plaintiff
against whom a counterclaim has been asserted, in any litigation, pending or
threatened, nor has any material claim been made or asserted against NextGen,
nor are there any proceedings threatened or pending before any federal, state or
municipal government, or any department, board, body or agency thereof,
involving NextGen except as disclosed in Exhibit "A".
(g) NextGen is not in default under any agreement to
which it is a party nor in the payment of any of its obligations.
(h) Between the date of the balance sheet referred to
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in subparagraph "c" hereof and the Closing, NextGen will not (i) mortgage or
pledge or subject to any lien, charge or other encumbrance any of their assets,
tangible or intangible, except in the usual and ordinary or (ii) sold, leased,
or transferred or contracted to sell, lease or transfer any assets, tangible or
intangible, or entered into any other transactions, except in the usual and
ordinary course of business, or (iii) made any material change in any existing
employment agreement or increased the compensation payable or made any
arrangement for the payment of any bonus to any officer, director, employee or
agent, except as set forth in Exhibit "A" hereof.
(i) This Exchange Agreement has been duly executed by
Hunter as the Exchange Agent for the stockholders of NextGen and the execution
and performance of this Exchange Agreement will not violate, or result in a
breach of, or constitute a default in any agreement, instrument, judgment, order
or decree to which NextGen is a party or to which NextGen is subject nor will
such execution and performance constitute a violation of or conflict with any
fiduciary to which NextGen is subject, to the best of NextGen's knowledge.
(j) NextGen has timely filed or obtained the
necessary extensions with the appropriate governmental authorities, all tax and
other returns required to be filed by it. Such returns are true and complete and
all taxes shown thereon to be due have been paid. All material, federal, state,
local, county, franchise, sales, use, excise and other taxes assessed or due
have been duly paid or reserves for unpaid taxes have been set up as required on
the basis of the facts and in accordance with generally accepted accounting
principles.
(k) NextGen is not in default with respect to any
order, writ, injunction , or decree of any court or federal, state, municipal or
other governmental department, commission, board, bureau, agency or
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instrumentality, and there are no actions, suits, claims, proceedings or
investigations pending or, to the knowledge of NextGen threatened against or
affecting NextGen, at law or in equity, or before or by any federal, state,
municipal or other governmental court, department commission, board, bureau,
agency or instrumentality, domestic or foreign. NextGen has complied in all
material respects with all laws, regulations and orders applicable to its
business.
(l) No representation in this section, nor statement
in any document, certificate or schedule furnished or to be furnished pursuant
to this Exchange Agreement by NextGen, or in connection with the transactions
contemplated hereby, contains or contained any untrue statement of material
fact, nor does or will omit to state a material fact necessary to make any
statement of fact contained herein or therein not misleading.
2. [REPRESENTATIONS OF ROYAL] Royal represents to Hunter that:
(a) Royal is a corporation duly organized and validly
existing and in good standing under the laws of the State of Nevada; is not
qualified to transact business in any other state; and has an authorized
capitalization of 100,000,000 shares of which there are issued and outstanding
479,000 shares of common stock, par value $0.001 per share.
(b) Royal has delivered to Hunter its balance sheet,
financial statement for the period ended December 31, 1997, which is attached
hereto and marked Exhibit "B". This financial statement accurately set forth the
financial condition of Royal as of the date specified, prepared in conformity
with generally accepted accounting principles consistently applied.
(c) Royal has good and marketable title to all of its
property and assets (except property and assets disposed of since such date in
the usual and ordinary course of business), subject to no mortgage, pledge, lien
or other encumbrance except as disclosed in such balance sheet or in Exhibit "B"
annexed hereto and made a part hereof.
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(d) Royal has no obligations, liabilities or
commitments, contingent or otherwise, of a material nature which were not
provided for, except as set forth in such balance sheet or in Exhibit "B".
(e) There has been no change in the nature of the
business of Royal, nor in its financial condition or property, other than
changes in the usual and ordinary course of business, none of which has been
materially adverse, and Royal has incurred no obligations or liabilities or made
any commitments other than in the usual and ordinary course of business except
as disclosed in Exhibit "B".
(f) Royal is not a party to any employment contract
with any officer, director, or stockholder, or to any lease, agreement or other
commitment not in the usual and ordinary course of business, nor to any pension,
insurance, profit-sharing or bonus plan, except as disclosed in Exhibit "B".
(g) Royal is not defendant, nor a plaintiff against
whom a counterclaim has been asserted, in any litigation, pending or threatened,
nor has any material claim been made or asserted against Royal, nor are there
any proceedings threatened or pending before any federal, state or municipal
government, or any department, board, body or agency thereof, involving Royal,
except as disclosed in Exhibit "B".
(h) Royal is not in default under any agreement to
which it is a party nor in the payment of any of its obligations.
(i) Between the date of the balance sheet referred to
in subparagraph "b" hereof and the Closing, Royal will not have (i) paid or
declared any dividends on or made any disbursements in respect of, or issued,
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purchased or redeemed, any of the outstanding shares of its capital stock, or
(ii) made or authorized any changes in its Articles of Incorporation or in any
amendment thereto or in its By-Laws, or (iii) made any commitments or
disbursements or incurred any obligations or liabilities of a substantial nature
and which are not in the usual and ordinary course of business, or (iv)
mortgaged or pledged or subjected to any lien, charge or other encumbrance any
of their assets, tangible or intangible, except in the usual and ordinary course
of its business, or (v) sold, leased, or transferred or contracted to sell,
lease or transfer any assets, tangible or intangible, or entered into any other
transactions, except in the usual and ordinary course of business, or (vi) made
any loan or advance to any stockholder of Royal, or to any other person, firm,
or corporation except in the usual and ordinary course of business, or (vii)
made any material change in any existing employment agreement or increased the
compensation payable or made any arrangement for the payment of any bonus to any
officer, director, employee or agent, except as set forth in Exhibit "B" hereof.
(j) This Exchange Agreement has been duly executed by
Royal and the execution and performance of this Exchange Agreement will not
violate, or result in a breach of, or constitute a default in any agreement,
instrument, judgment, order or decree to which it is a party or to which it is
subject nor will such execution and performance constitute a violation of or
conflict with any fiduciary to which it is subject.
(k) Royal has filed with the appropriate governmental
authorities, all tax and other returns required to be filed. Such returns are
true and complete and all taxes shown thereon to be due have been paid. All
material, federal, state, local, county, franchise, sales, use, excise and other
taxes assessed or due have been duly paid and no reserves for unpaid taxes have
been set up or are required on the basis of the facts and in accordance with
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generally accepted accounting principles.
(l) Royal is not in default with respect to any
order, writ, injunction, or decree of any court or federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality, and there are no actions, suits, claims, proceedings or
investigations pending or, to the knowledge of Royal threatened against or
affecting Royal, at law or in equity, or before or by any federal, state,
municipal, or other governmental court, department, commission, board, bureau,
agency or instrumentality, domestic or foreign. Royal has complied in all
material respects with all laws, regulations and orders applicable to its
business.
(m) No representation in this section, nor statement
in any document, certificate or schedule furnished or to be furnished pursuant
to this Exchange Agreement by Royal, or in connection with the transactions
contemplated hereby, contains or contained any untrue statement of a material
fact, nor does or will omit to state a material fact necessary to make any
statement of fact contained herein or therein not misleading.
3. [DATE AND TIME OF CLOSING] The closing shall be held on
Wednesday, January 28, 1998, at 10 a.m., local time, at 00 Xxxx Xxxxxxx Xxxxxx,
Xxxxx 000, Xxxx, Xxxxxx, or at such other time and place as may be mutually
agreed upon between the parties in writing (hereinafter "the Closing").
4. [EXCHANGE OF SHARES OF STOCK] The mode of carrying into
effect the exchange provided for in this Agreement shall be as follows:
(a) Royal shall call a special directors' meeting to
be held on Wednesday, January, 28, 1997, at 9:00 a.m., local time, at 00 Xxxx
Xxxxxxx Xxxxxx, Xxxxx 000, Xxxx, Xxxxxx, for the following purposes:
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(1) To ratify, approve and carry out the
terms of this Exchange Agreement.
(2) To call a special stockholders meeting
to amend the Articles of Incorporation to change the
corporate name to Capita Research Group, Inc.
(3) To call a special stockholders meeting
to authorize a forward split of 2 to 1 whereby the
present stockholders will be entitled to 2 shares for
each share owned by them in Royal.
(b) Royal shall call and convene a special
stockholders meeting at 9:30 a.m. on Wednesday, January 28, 1998 to change the
corporate name to Capita Research Group, Inc. and the forward split of 2 for 1
set forth in 4(a)(3) above. It shall file an Amendment to the Articles of
Incorporation with the Secretary of State of Nevada on Wednesday, January 28,
1998 to reflect these changes.
(c) Royal shall call and convene a special directors
meeting at 10:00 a.m. for the following purposes:
(1) To effect delivery by the officers of
Royal to Xxxxx Xxxxxx, Exchange Agent for the
shareholders stock certificates representing
8,622,000 shares of common stock of Capita Reasearch
Group, Inc. in exchange for the delivery of all the
stock certificates of the outstanding stock of
NextGen.
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(2) To deliver a check for $40,000 payable
to Nevada Agency & Trust Company as the fee for this
corporate reorganization. The total fee being $50,000
of which $10,000 has been paid.
(3) To elect three (3) nominees designated
by Hunter to comprise the entire Board of Directors,
being Xxxxx X. Xxxxxx, Xxxxxxx X. Xxxxx and Xxxxxxx
X. Xxxxxxx, XX.
5. [CONDITIONS TO CLOSING] Royal and Hunter's obligations to
complete the transactions provided for herein shall be subject to the
performance by them of all their respective agreements to be performed hereunder
on or before the Closing, to the material truth and accuracy of the respective
representations of Royal and Hunter contained herein, and to the further
conditions that:
(a) All representations of Hunter and Royal contained
in this Exchange Agreement are true and correct on and as of the Closing with
the same effect as if made on and as of said date.
(b) As of the Closing, there shall have been no
material adverse change in the affairs, business, property or financial
condition of NextGen and Royal.
(c) All of the agreements and covenants contained in
this Exchange Agreement that are to be complied with, satisfied and performed by
each of the parties hereto on or before the Closing, shall, in all material
respects, have been complied with, satisfied and performed.
6. [FINDER'S FEE] Each party represents to the other that
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it has not employed any other broker or agent or entered into any other
agreement for the payment of any finder's fees or compensation to any other
person, firm or corporation in connection with this transaction.
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7. [NOTICES] Any notice under this Agreement shall be deemed
to have been sufficiently given if sent by Federal Express, registered or
certified mail, postage prepaid, addressed as follows:
If to the Stockholder:
Xxxxx X. Xxxxxx, Exchange Agent
000 Xxxx Xxxxxx Xxx.
Xxxxx 000
Xxxx xx Xxxxxxx, XX 00000
with a required copy to:
Xxxxxxxx X. Xxxxx, Esq.
Xxxxxx, Xxxxxxxxx & Xxxxxxxxxx, P.A.
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000-0000
If to Royal, to:
Royal American Mining Properties, Ltd.
00 Xxxx Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx, Xxxxxx 00000
Attention: Xxxxx Xxx Xxxxxx
or to any other address which may hereafter be designated by either party by
notice given in such manner. Al notices shall be deemed to have been given as of
the date of receipt.
8. [COUNTERPARTS] This Exchange Agreement may be executed in
any number of counterparts, each of which when executed and delivered shall be
an original, but all such counterparts shall constitute one and the same
instrument.
9. [MERGER CLAUSE] This Exchange Agreement supersedes all
prior agreements and understandings between the parties and may not be changed
or terminated orally, and no attempted change, termination or waiver of any of
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the provisions hereof shall be binding unless in writing and signed by the
parties hereto.
10. [GOVERNING LAW] This Agreement shall be governed by and
construed according to the laws of the State of Nevada with regard to Royal
American being its corporate domicile and Pennsylvania with regard to NextGen
Systems, Inc., being its corporate domicile.
IN WITNESS WHEREOF, the parties hereto have caused
this Exchange Agreement to be executed the day and year first above written.
ROYAL AMERICAN MINING PROPERTIES, LTD.
A Nevada Corporation
By /s/Xxxxx Xxx Xxxxxx
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Xxxxx Xxx Xxxxxx
President
(Hereunto duly authorized)
For purposes of Section 2 hereof:
By /s/Xxxxx Xxx Waliker
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Xxxxx Xxx Xxxxxx
By /s/Xxxxxxxxx X. Xxxxxx
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Xxxxxxxxx X. Xxxxxx
EXCHANGE AGENT FOR SHAREHOLDERS OF
NEXTGEN SYSTEMS, INC.
By /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
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