AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION is entered into as of the day
of August 7, 2002 by and between the following:
(a) WAVE XXXXX.XXX. INC. (the "Company"), a Delaware corporation, whose
address is c/o 0000 Xxxxx Xxxx Xx. Xxxxx 0X, Xxxxxxxxxx, Xx. 00000; and
(b) BETTER CALL HOME, INC. ("BCH"), a Nevada corporation, whose address
is 000 X. Xxxxxxxxx Xxxxxx Xx. Xxxxxx Xxxx Xxxxxx 00000
Recitals.
A. The Company and BCH desire to effect a Type B reorganization under
Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended, on the
terms and conditions set forth below, whereby the Company will acquire all of
the issued and outstanding shares of BCH's common stock by issuing solely in
exchange therefore to BCH's shareholders, pro-rata, the Sixteen Million
Restricted Common Shares (16,000,000) (the "Shares") after a 5:1 reverse split
of the shares.
NOW THEREFORE in consideration of the foregoing recitals, the mutual
representations, warranties and covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
I. BASIC TRANSACTION.
1.1 Plan of Reorganization. Subject to the terms and conditions of
this Agreement and pursuant to Section 368(a)(1)(B) of the Internal Revenue Code
of 1986, as amended, the parties to this Agreement shall effect a Type B
reorganization (the "Reorganization") whereby 100% of the outstanding shares of
BCH's common stock will be exchanged for 16,000,000 of the Company's Post
Reverse Split Common Shares. The Reorganization shall take place on the Closing
Date (hereinafter defined in Section 1.2 of this Agreement) and shall be
accomplished in accordance with Article V below. In addition, the Company agrees
to retain Vocalscape Networks, Inc. pursuant to the Management Agreement
attached hereto and incorporated herein by this reference.
1.2 Closing. The closing of the Reorganization and exchange
contemplated and provided for in this Agreement (the "Closing") shall take at a
time and place to be mutually agreed upon by the parties on the third business
day following the satisfaction or waiver or all conditions to the obligations of
the parties to consummate the subject reorganization and exchange (other than
the conditions with respect to actions the respective parties will take at the
Closing itself) or such other date as the parties may mutually determine (the
"Closing Date"); provided, however, that the Closing Date shall occur no later
than August 30, 2002. 1
1.3 Terms of Exchange. On the Closing Date:
(a) The Company shall ratably issue and cause to be delivered to
the BCH shareholders Sixteen Million of the Company's Post Reverse Split Common
Shares, in consideration for the transfer to the Company by the BCH shareholders
of all the 1,000,000 shares of the capital stock of BCH issued and outstanding
as of the Closing Date. No other shares, warrants, rights, or options relating
to BCH are outstanding on the date of this Agreement or shall be outstanding on
the Closing Date; and
(b) The BCH shareholders shall, in consideration for their
receipt of the Company's Common Shares, transfer and deliver to the Company
certificates representing all of the issued and outstanding shares of BCH's
common stock owned by them. The Company shall receive good and marketable title
to all of BCH's issued and outstanding common stock free and clear of all liens,
mortgages, pledges, claims or other rights or encumbrances whatever, whether
disclosed or undisclosed.
1.4 Restrictions on Transfer. The Company's Common Shares, when
issued and delivered hereunder, shall not be registered under the Securities Act
of 1933, as amended, nor shall the BCH shareholders be granted any registration
rights as to such shares. Each certificate representing shares of the Company's
Common Shares will bear a customary restrictive legend which states in effect
that such shares have not been registered under the Securities Act of 1933 and
consequently may not be transferred, assigned, sold or hypothecated unless
registered under the Securities Act of 1933 or, in the opinion of Company's
counsel, an exemption from the registration requirements of the Securities Act
of 1933 is available for such transaction. Notwithstanding such restriction, the
Company agrees to grant the BCH shareholders shares, piggyback rights, in any
SB-2 registration statement commenced within the next 24 months. The Company
will file an SB-2 registration statement within two months of the closing and
will register 900,000 shares of the BCH shareholders stock subject to a l2 month
leak out or 5% of the weekly trading volume which ever is greater.
II. REPRESENTATIONS AND WARRANTIES.
2.1 Representations and Warranties of BCH. BCH hereby represents and
warrants to the Company that the statements contained in this Section 2.1 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though then and as though the Closing Date
were substituted for the date of this Agreement throughout this Section 2.1),
except as set forth in the disclosure schedule accompanying this Agreement (the
"BCH Disclosure Statement). The BCH Disclosure Statement will be arranged in
paragraphs corresponding to the lettered subsections contained in this Section
2.1.
(a) Due Organization. BCH is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Nevada and
is qualified to do business and is in good standing in all jurisdictions in
which such qualification is necessary. BCH has all requisite corporate power and
authority to conduct its business, to own its properties and to execute and
deliver, and to perform all of its obligations under this Agreement to which it
is a party.
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(b) Due Authority. The execution, delivery and performance under
this Agreement and the documents provided for herein by BCH have been authorized
by all necessary corporate action; provided, however, that BCH cannot consummate
the Reorganization unless or until it receives the requisite approval from its
shareholders, which shareholders must unanimously approve and ratify this
Agreement.
(c) Capitalization. BCH's authorized capitalization presently
consists of 1,000,000 shares of capital stock, no par value, of which, as of the
date hereof, 1,000,000 shares are issued and outstanding and no shares have been
reserved for issuance based upon certain specified contingencies. All issued and
outstanding shares have been duly authorized, validly issued and fully paid and
non-assessable, and subject to no preemptive rights of any shareholder.
(d) Outstanding Options, Warrants or Other Rights. BCH has no
outstanding warrants, options or similar rights whereby any person may subscribe
for or purchase shares of its common stock, nor are there any other securities
outstanding which are convertible into or exchangeable for its common stock, and
there are no contracts or commitments pursuant to which any person may acquire
or BCH may become bound to issue any shares of such common stock. BCH has not,
nor shall it, declare any dividend, whether in stock, money or property, nor
shall it repurchase any or all of its shares.
(e) Copies of Documents Genuine. All copies of BCH's articles of
incorporation and bylaws (each as amended to date) and all minutes of meetings
or written consents in lieu of meetings of shareholders, directors and
committees of directors of BCH which have been or will be furnished to the
Company are true, complete, correct and unmodified copies of such documents.
(f) Liabilities (Contingent or Actual). None.
(g) Officers and Directors. The officers and directors of BCH
consists of the following:
Name Office
------------- -------------
Xxxxx Xxxxxxx Director, CEO
(h) Non-contravention. The execution of this Agreement by BCH and
the consummation of the transactions contemplated hereby will not result in the
breach of any term or provision of, or constitute a default under, any provision
or restrictions of any indenture, agreement, or other instrument or any
judgment, order, or decree to which BCH is a party or by which it is bound, or
will it conflict with any provisions or the Articles of Incorporation or Bylaws
of BCH.
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(i) Litigation. There are no suits, actions or proceedings at law
or in equity, pending or threatened against or affecting BCH that can be
expected to result in any materially adverse change in the business, properties,
operations, prospects, or assets or in its condition, financial or otherwise.
There are no tax, worker's compensation, payroll or labor proceedings or
investigations threatened or pending, nor does BCH nor its shareholders have any
basis to believe that such proceedings or investigations may be instituted.
(j) Laws and Regulations. BCH has complied with all laws, rules,
regulations and ordinances relating to or affecting the conduct of BCH's
business and BCH possesses and holds all licenses and permits required in its
business by federal, state or local authorities. BCH's books and records and its
tax returns, as required, have been prepared and filed in accordance with GAAP
requirements and applicable laws.
(k) Full Disclosure. Neither this Agreement nor any other
instrument furnished to the Company by or on behalf of BCH contains any untrue
statement of a material fact or omits to state a material fact necessary to make
any statements made not misleading, and there is no fact that materially and
adversely affects, or foreseeably may materially and adversely affect, BCH's
financial condition, liabilities, business, or assets that have not been
disclosed herein or in any other instrument. BCH further declares and discloses,
that; there are no union or labor strikes or lockouts; all tax returns required
to filed and all sums due have been paid and/or escrowed for liabilities accrued
but not yet due; all salaries and benefits, including pension and profit
sharing, have been paid or are escrowed.
(l) Representations and Warranties True at Closing. Except as
expressly herein otherwise provided, all of the representations and warranties
of BCH set forth herein shall be true as of the Closing Date as though such
representations and warranties were made on and as of such date.
2.2 Representations and Warranties of the Company. The Company
represents and warrants to BCH and its shareholders that the statements
contained in this Section 2.2 are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
then and as though the Closing Date were substituted for the date of this
Agreement throughout this Section 2.2), except as set forth in the disclosure
schedule accompanying this Agreement (the "Company Disclosure Statement"). The
Company Disclosure Statement will be arranged in paragraphs corresponding to the
lettered subsections contained in this Section 2.2.
(a) Organization. The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware
and is qualified to do business and is in good standing in all jurisdictions in
which such qualification is necessary. The Company has all requisite corporate
power and authority to conduct its business, to own its properties and to
execute and deliver, and to perform all of its obligations under this Agreement
to which it is a party.
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(b) Due Authority. The execution, delivery and performance under
this Agreement and the documents provided for herein by Company have been
authorized by all necessary corporate action.
(c) Capitalization. The Company's authorized capitalization
presently consists of 75,000,000 shares of capital stock, .001 par value, of
which as of June 30, 2002, 20,065,000 pre-reverse split shares are issued and
outstanding and 9,987,400 Post Reverse Split Common Shares have been reserved
for future issuance based upon consummation of this agreement, expenses advanced
and certain specified contingencies. Upon payment of all reserved shares,
management shares (minimum) and shares issued pursuant to this Agreement there
will be 30,000,000 shares issued and outstanding. All issued and outstanding
shares have been duly authorized, validly issued and fully paid and
non-assessable and the Company's Common Shares to be issued and delivered on the
Closing Date to the BCH Shareholders pursuant to the Agreement will be, when so
delivered, duly authorized and validly issued and subject to no preemptive
rights of any Shareholder.
(d) Outstanding Options, Warrants or Other Rights. Except as set
forth in the Company Disclosure Statement and as provided for herein, the
Company has no outstanding warrants, options or similar rights whereby any
person may subscribe for or purchase shares of its common stock, nor are there
any other securities outstanding which are convertible into or exchangeable for
its common stock, and there are no contracts or commitments pursuant to which
any person may acquire or BCH may become bound to issue any shares of such
common stock.
(e) Financial Statements. The Company has provided BCH with its
most recent financial statements dated March 31, 2002. These financial
statements have been prepared in accordance with generally accepted accounting
principles, are correct, complete, and fairly represent the financial position
and results of operations of the Company as of said date and for the periods
indicated.
(f) Adverse Changes. Since the date of the financial statements
described in Section 2.2(e) above, there have not been, and prior to the Closing
Date, there will not be, any material changes in the financial position of the
Company and its subsidiaries (if any) except changes arising in the ordinary
course of business and except changes that are otherwise disclosed in writing to
BCH.
(g) Undisclosed Liabilities. The Company does not have any
liability (whether known or unknown, whether asserted or unasserted, whether
absolute or contingent, whether accrued or un-accrued, whether liquidated or
un-liquidated, and whether due or to become due) except for liabilities set
forth on the face of the Balance Sheet delivered to BCH in accordance with the
provisions of Section 2.2(e) above, and liabilities which have arisen after the
date of the financial statements provided in accordance with the provisions of
Section 2.2(e) above in the ordinary course of the Company's business.
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(h) Copies of Documents Genuine. All copies of the Company's
articles of incorporation and bylaws (each as amended to date) and all minutes
of meetings or written consents in lieu of meetings of shareholders, directors
and committees of directors of the Company which have been or will be furnished
to BCH are true, complete, correct and unmodified copies of such documents.
(i) Non-contravention. The execution of this Agreement by the
Company and the consummation of the transactions contemplated hereby will not
result in the breach of any term or provision of, or constitute a default under,
any provision or restrictions of any indenture, agreement, or other instrument
or any judgment, order, or decree to which the Company is a party or by which it
is bound, or will it conflict with any provisions or the Articles of
Incorporation or Bylaws of the Company.
(j) SEC Filings. The Company has made all filings with the SEC
that it has been required to make under the Securities Act of 1933, as amended,
and the Securities Exchange Act of 1934, as amended (collectively the "Public
Reports"). Each of the Public Reports has complied with the Securities Act and
the Securities Exchange Act in all material respects. None of the Public
Reports, as of their respective dates, contained any untrue statement of a
material fact, or omitted to state a material fact necessary in order to make
the statements made therein, in light of the circumstances under which they were
made, not misleading.
(k) Litigation. There are no suits, actions or proceedings at law
or in equity, pending or threatened against or affecting the Company that can be
expected to result in any materially adverse change in the business, properties,
operations, prospects, or assets or in its condition, financial or otherwise,
except as set forth hereinafter and in the Company's filings with the Securities
and Exchange Commission.
(l) Laws and Regulations. The Company has complied with all
laws, rules, regulations and ordinances relating to or affecting the conduct of
the Company's business and the Company possesses and holds all licenses and
permits required in its business by federal, state or local authorities.
(m) Full Disclosure. Neither this Agreement nor any other
instrument furnished to BCH by or on behalf of the Company contains any untrue
statement of a material fact or omits to state a material fact necessary to make
any statements made not misleading, and there is no fact that materially and
adversely affects, or foreseeably may materially and adversely affect, the
Company's financial condition, liabilities, business, or assets that have not
been disclosed herein or in any other instrument.
(n) Representations and Warranties True at Closing. Except as
expressly herein otherwise provided, all of the representations and warranties
of the Company set forth herein shall be true as of the Closing Date as though
such representations and warranties were made on and as of such date.
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III. COVENANTS.
From the date of this Agreement until the Closing Date, the Company and
BCH agree as follows:
3.1 General. Each of the parties hereto will use its best efforts to
take all actions and to do all things necessary in order to consummate and make
effective the transaction contemplated by this Agreement (including satisfaction
of the closing conditions set forth in Article IV below).
3.2 Notices and Consents. Each of the parties hereto will give any
notices to third parties, and will use its best efforts to obtain any third
party consents, that the other party reasonably may request in connection with
any matter referred to in Sections 2.1 or 2.2 above.
3.3 Regulatory Matters and Approvals. Each of the parties hereto will give
notices to, make any filings with, and use its best efforts to obtain any
authorizations, consents and approvals of governments and governmental agencies
in connection with the matters referred to in Sections 2.1 and 2.2 above.
Without limiting the generality of the foregoing:
(a) Securities Law Compliance. The Company will take all actions
as may be necessary, proper and advisable, under Federal and state securities
laws in connect with the offering and issuance of the Common Shares to the BCH
shareholders in connection with the Reorganization provided for under this
Agreement.
(b) Nevada Corporation Law. BCH will call a special meeting of
its shareholders as soon as reasonably practicable in order that its
shareholders may consider and vote upon the adoption of this Agreement and the
approval of the Reorganization with the resultant sale and transfer to the
Company of all of the issued and outstanding shares of BCH's common stock.
3.4 Operations of Business. BCH will not engage in any practice, take
any action, or enter into any transaction outside the ordinary course of
business. Without limiting the generality of the foregoing, BCH will not: (a)
authorize or effect any change in its charter or bylaws;
(b) grant any options, warrants or other rights to purchase or
obtain any of its capital stock or issue, sell, or otherwise dispose of any of
its capital stock (except upon the conversion or exercise of options, warrants,
and other rights currently outstanding);
(c) declare, set aside, or pay any dividend or distribution with
respect to its capital stock (whether in cash or in kind), or redeem, repurchase
or otherwise acquire any of its capital stock;
(d) Issue any note, bond or other debt security or create, incur,
assume, or guarantee any indebtedness for borrowed money or capitalized lease
obligations outside the ordinary course of business except for a working line of
credit up to $20,000;
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(e) Grant any security interest on, or otherwise pledge, any of
its assets outside the ordinary course of business except as it pertains to the
indebtedness excepted in subsection (d) above;
(f) Make any capital investment in, make any loan to, or acquire
the securities or assets of any other person or entity outside the ordinary
course of business; and
(g) Make any change in management terms for any of its directors,
officers and employees outside the ordinary course of business.
3.5 Access. The Company and BCH each agree that they will permit the
other's directors, officers, accountants, attorneys and other representatives
full access, during reasonable business hours throughout the term or
applicability of this Agreement, to all premises, properties, personnel, books,
records, contracts and documents of or pertaining to the other's business
affairs, operations, properties and financial affairs as the other party may
reasonably request. All information provided shall be furnished strictly subject
to the confidentiality provision of this Agreement.
3.6 Confidentiality. All information and documents furnished by a
party pursuant to Section 3.5 of this Agreement shall be deemed and treated as
proprietary in nature. Each party (and the BCH shareholders) agree that it shall
hold all information received from another party pursuant to or in connection
with this Agreement in the highest and strictest confidence and shall not reveal
any such information to any individual who is not one of its directors,
officers, key employee, attorney or accountant, and that it will not use any
such information obtained for any purpose whatsoever other than assisting in its
due diligence inquiry precedent to the Closing and, if this Agreement is
terminated for any reason whatsoever, agrees to return to the other party any
all tangible embodiments (and all copies) thereof which are in its possession.
This covenant shall survive the consummation or termination of this Agreement.
3.7 Publicity and Filings. All press releases, shareholder
communications, filings with the Securities and Exchange Commission or other
governmental agency or body and other information and publicity generated by the
Company or BCH regarding the Reorganization and exchange contemplated in this
Agreement shall be reviewed and approved by the other party and its counsel
before release or dissemination to the public or filing with any governmental
agency or body whatever.
3.8 Notice of Developments. Each party hereto will give prompt
written notice to the other of any material adverse development causing a breach
of any of its own representations and warranties in Sections 2.1 and 2.2 above.
No disclosure by any party hereto pursuant to this Section 3.8, however, shall
be deemed to amend or supplement the disclosure statement provided under the
terms of this Agreement or to prevent or cure any breach of warranty, breach of
covenant or misrepresentation.
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3.9 Stand-Still Agreement. BCH will not (and each BCH Shareholder
agrees that it will not on behalf of BCH) solicit, initiate, or encourage the
submission of any proposal or offer from any person or entity relating to the
acquisition of all or substantially all of the capital stock or assets of BCH
(including any acquisition structured as a merger, consolidation, or share
exchange). BCH shall notify the Company immediately if any person or entity
makes any proposal, offer, inquiry, or contact with respect to any such
unsolicited offer or expression of interest.
3.10 Covenants of BCH Shareholders. Each of the BCH Shareholders
covenants and agrees with, and represents to, the Company as follows:
(a) No Registration of Company Stock. Each of the BCH
Shareholders understands that none of the Post Reverse Split Common Shares to be
received from the Company at Closing have not been registered under the
Securities Act of 1933 or any applicable securities laws of any state. Each of
the Shareholders hereby represents and warrants that the Common Shares are being
acquired by him/her/it solely for investment and not with a view to distribution
or immediate resale thereof.
(b) Stock Legend. Each of the BCH Shareholders further agree and
understand that each Debenture issued under the Reorganization and exchange
provided for under this Agreement will bear the customary restrictive legend
conspicuously noted on said certificate.
3.11 Election of Officers. The Company agrees that Xxxxx Xxxxxxx , the
current CEO of BCH, shall remain as the CEO of BCH after the consummation of the
Reorganization and exchange provided for under the terms of this Agreement and
shall be further authorized, subject to approval of BCH's and the Company's
existing Board of Directors, to select the officers and 1 director of BCH. The
Company covenants and agrees to approve of the officers selected made by the
Board of BCH and further that a designated BCH director shall be appointed,
effective as of the Closing Date, as a member of the Company's Board of
Directors. This covenant shall survive the consummation of this Agreement.
3.12 Management Agreement. The Company agrees that a management
agreement in form and substance substantially similar to Ex. "A" hereto shall be
entered into between the Company and Vocalscape Networks, Inc. according to the
terms thereof. However, the Company shall have no monetary financial commitment
to pay Vocalscape Networks, Inc. if BCH is not generating sufficient revenues
from its continuing operations. This covenant shall survive the consummation of
this Agreement.
IV. CONDITIONS TO THE EXCHANGE.
4.1 Conditions Precedent to Exchange by Company. The obligation of
the Company to consummate the Reorganization contemplated by this Agreement are
subject to satisfaction, or written waiver by the Company, of the following
conditions at or before the Closing Date:
(a) Representations and Warranties True. The representations and
warranties by BCH and the BCH Shareholders in the Agreement shall have been
correct on and as of the Closing Date with the same force and effect (except as
expressly provided in the Agreement or otherwise approved in writing by the
Company) as though such representations and warranties had been made on and as
of the Closing Date.
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(b) No Adverse Change. BCH shall not have suffered any adverse
change in its financial condition or business and no properties or assets of BCH
shall have suffered any destruction, damage or loss, whether or not covered by
insurance. In addition, BCH shall have obtained an exclusive license pertaining
to the software and intellectual property relating to (Voice Over Internet
Protocol (VOIP), its derivates, and successor technologies, whether or not a
patent has been applied for in any of the named technologies or products without
royalty or obligation except as provided for herein) for use in the prepaid
calling card business and a non exclusive license for use in other applications.
(c) Performance. BCH and the BCH Shareholders shall have
performed all of the terms, covenants, agreements and conditions of the
Agreement on their respective parts to be performed.
(d) Shareholder Approval. The BCH shareholders shall have
approved the terms and conditions of the Reorganization and the final language
of the Common Shares as provided for herein and no BCH shareholder shall dissent
with respect to the Reorganization provided for in this Agreement.
(e) Tax Opinion. The Company shall have received or waived the
favorable written opinion from its counsel to the effect that the transactions
contemplated by this Agreement will constitute a "reorganization" within the
meaning of Section 368 of the Internal Revenue Code of 1986, as amended, and
will not result in the recognition of gain or loss to the Company or to BCH or
the BCH shareholders.
(f) Legal Opinion. The Company shall have received the favorable
written opinion of counsel for BCH as to those matters set forth in Exhibit A
attached hereto and any other matter which the Company may reasonably requested
in connection with the Reorganization provided for in this Agreement. In
rendering the required opinion, counsel may, as to any factual matter, rely upon
a certificate of any public official and any officer of BCH who is cognizant of
such fact.
(g) No Restraint. No injunction or restraining order shall be in
effect to forbid or enjoin the consummation of this Agreement.
(h) Approval of Documents. All legal matters in connection with
the consummation of the Reorganization contemplated by this Agreement and all
documents and instruments delivered in connection therewith shall be reasonably
satisfactory in form and in substance to counsel for the Company and such
counsel shall have received authenticated copies of those copies of the
corporate documents and certificates as counsel for the Company may reasonably
request in connection with this transaction.
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4.2 Conditions to BCH's Obligations. The obligations of BCH and the
BCH Shareholders to consummate the Reorganization contemplated by this Agreement
are subject to satisfaction or written waiver by BCH and the BCH Shareholders of
the following conditions at or before the Closing Date:
(a) Representations and Warranties True. The representations and
warranties by the Company in the Agreement shall have been correct on and as of
the Closing Date with the same force and effect (except as expressly provided in
the Agreement or otherwise approved in writing by the Shareholders) as though
such representations and warranties had been made on and as of the Closing Date.
(b) No Adverse Change. The Company shall not have suffered any
adverse change in its financial condition or business and no properties or
assets of the Company shall have suffered any destruction, damage or loss,
whether or not covered by insurance.
(c) Performance. The Company shall have performed all of the
terms, covenants, agreements and conditions of the Agreement on its part to be
performed.
(d) Shareholder Approval. The Company majority shareholders shall
have approved the terms and conditions of this Agreement and shall have called a
shareholders meeting to approve a name change and the reverse split of the
common shares.
(e) Legal Opinion. BCH shall have received the favorable written
opinion of counsel for the Company as to those matters set forth in Exhibit A
attached hereto and any other matter which BCH may reasonably request in
connection with the Reorganization provided for in this Agreement. In rendering
the required opinion, counsel may, as to any factual matter, rely upon a
certificate of any public official and any officer of the Company who is
cognizant of such fact.
(f) No Restraint. No injunction or restraining order shall be in
effect to forbid or enjoin the consummation of this Agreement.
(g) Approval of Documents. All legal matters in connection with
the consummation of the Reorganization contemplated by this Agreement and all
documents and instruments delivered in connection therewith shall be reasonably
satisfactory in form and in substance to counsel for BCH and such counsel shall
have received authenticated copies of those copies of the corporate documents
and certificates as counsel for BCH may reasonably request in connection with
this transaction.
V. ACTIONS AT CLOSING.
5.1 Exchange. Each of the 1,000,000 shares of BCH's common stock that
shall be outstanding on the Closing Date and held by a BCH shareholder shall be
exchanged for a pro-rata portion of the Company's Sixteen Million (16,000,000)
Post Reverse Split Common Shares; provided, however, that the number of shares
of the Company's Post Reverse Split Common Shares into which shares of BCH's
common stock are to converted shall be rounded off to the nearest whole number
of shares, and no fractional shares shall be issued. The pro-rata portion of the
Company's Common Shares that each BCH shareholder shall receive in exchange for
his or her shares of BCH's common stock are set forth in Exhibit B attached
hereto.
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5.2 Shareholders' Actions at Closing. On the Closing Date, the BHC
Shareholders, contemporaneously with the performance by Company of its
obligations to be performed at the Closing, shall deliver to the Company the
following:
(a) BCH Stock Certificates. Stock certificates representing all
of the outstanding shares of BCH's common stock endorsed for transfer, with all
necessary stock assignments and other pertinent documents.
(b) Certified Corporate Resolutions. Certified copy of the
resolutions duly adopted by the Board of Directors and the shareholders of BCH
authorizing and approving the execution and delivery of this Agreement and the
performance of its obligations hereunder.
(c) Other Documents. Such further certificates and documents as
shall be reasonably requested by counsel for the Company to insure compliance by
BCH and BCH's shareholders of all obligations imposed upon them hereunder.
5.3 Company's Actions at Closing. On the Closing Date, the Company,
contemporaneously with the performance by BCH and the BCH shareholders of their
obligations to be performed at the Closing, shall deliver to the BCH
shareholders the following:
(a) Company Common Shares. Issue Post Reverse Split Common Shares
totaling 16,000,000 to which each BCH shareholder shall be entitled to receive
pursuant to this Agreement, as set forth in Exhibit "B" attached hereto, with
each share certificate bearing the restrictive legend described in Section 1.4
above.
(b) Certified Corporate Resolutions. Certified copy of the
resolutions duly adopted by the Board of Directors of the Company authorizing
and approving the execution and delivery of this Agreement by the Company and
the performance of its obligations hereunder.
(c) Opinion. The opinion of counsel as described in Section
4.1(f) of this Agreement; and
(d) Other Documents. Such further certificates and documents as
shall be reasonably requested by counsel to BCH and BCH shareholders to insure
compliance by the Company with all obligations imposed upon it hereunder.
5.4 Stock Rights. On the Closing Date, the BCH shareholders who have
exchanged their shares of BCH's common stock for shares of the Company's Post
Reverse Split Common Shares shall thereupon cease to have any rights with
respect to their BCH shares and their sole right thereafter shall be with
respect to the Company's Post Reverse Split Common Shares received hereunder.
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VI. TERMINATION.
6.1 Termination of Agreement. This Agreement may be terminated as
provided below:
(a) The parties hereto may terminate this Agreement by mutual
consent at any time prior to the Closing Date;
(b) The Company may terminate this Agreement by giving written
notice to the Shareholders at any time prior to the Closing Date (1) in the
event BCH and/or the Shareholders have breached any material representation,
warranty, or covenant contained in this Agreement in any material respect, the
Company has notified BCH and/or the Shareholders of this breach, and the breach
has continued without cure for a period of 10 days after the notice of breach,
or (2) if the Closing shall not have occurred on or before August 15, 2002 by
reason of the failure of any condition precedent under Section 4.1 hereof
(unless the failure results primarily from the Company breaching any
representation, warranty, or covenant contained in this Agreement); and
(c) BCH and the BCH Shareholders may terminate this Agreement
by giving written notice to the Company at any time prior to the Closing Date
(1) in the event the Company has breached any material representation, warranty,
or covenant contained in this Agreement in any material respect, BCH and the BCH
Shareholders have notified the Company of this breach, and the breach has
continued without cure for a period of 10 days after the notice of breach, or
(2) if the Closing shall not have occurred on or before August 15, 2002 by
reason of the failure of any condition precedent under Section 4.2 hereof
(unless the failure results primarily from the Shareholders and/or BCH breaching
any representation, warranty, or covenant contained in this Agreement).
6.2 Effect of Termination. If any party hereto terminates this
Agreement pursuant to Section 6.1 above, all rights and obligations of the
parties hereunder shall terminate without any liability of any party to the
other party (except for any liability of any Party then in breach); provided,
however, that the confidentiality provisions contained in Section 3.6 above
shall survive any such termination.
VII. GENERAL PROVISIONS.
7.1 Entire Agreement. This Agreement embodies the entire agreement
and understanding between the parties concerning the subject matter hereof and
supersedes any and all prior negotiations, understandings or agreements in
regard thereto.
7.2 Applicable Law. This Agreement shall be construed in accordance
and governed by the laws of the State of Nevada.
13
7.3 Notices. Unless otherwise changed by notice given in accordance
with this provision, any notice or other communications required or permitted
herein shall be deemed given if delivered personally or sent by certified mail,
postage prepaid, return receipt requested, addressed to the other parties at the
addresses set forth above or, in the case of the Shareholders, at the address
set forth their signature.
7.4 Waiver. All rights and remedies under this Agreement are
cumulative and are not exclusive of any other rights and remedies provided by
law. No delay or failure in the exercise of any right or remedy arising under
this Agreement shall operate as a waiver of any subsequent right or remedy
subsequently arising under this Agreement.
7.5 Survival of Provisions. All agreements, representations,
covenants and warranties on the part of the parties contained herein or in any
instrument executed and delivered in connection herewith shall survive closing
of this Agreement and any investigation at any time made with respect thereto.
7.6 Attorney's Fees. In the event of litigation for enforcement of
the terms of this Agreement or to enforce any remedy hereunder, the prevailing
party shall be entitled to recover from the other party any and all costs and
expenses, including reasonable attorney's fees, as may be incurred.
7.7 Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective personal representatives,
successors and assigns.
7.8 Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
7.9 Execution by Facsimile. Facsimile execution of this Agreement by
any party is authorized and shall be binding upon all parties.
7.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be considered an original hereof.
IN WITNESS WHEREOF, this Agreement has been executed on the date first
above written. WAVE XXXXX.XXX. INC. BETTER CALL HOME, INC.
By /s/Xxxxx Xxxxxx By /s/Xxxxx Xxxxxxx
-------------------------- ---------------------------
Xxxxx Xxxxxx, President Xxxxx Xxxxxxx, President
14
SHAREHOLDER AGREEMENTS AND COVENANTS
------------------------------------
THE UNDERSIGNED, each being shareholders of Better Call Home, Inc.
("BCH"), hereby represent that they own the number of shares of BCH's common
stock as set forth beneath their respective signature below and further covenant
and agree to comply with, undertake to perform, and abide by, the various
covenants, warranties and undertakings as set forth in Sections II, III and IV
of the foregoing Agreement and Plan of Reorganization dated August 7, 2002 by
and between Better Call Home, Inc. and Wave Xxxxx.xxx. Inc.
EXECUTED on the date set forth below the respective signatures.
SHAREHOLDERS:
Name: Vocalscape Networks Inc. Name: Confederated Capital Corp
Number of Shares: 176,000 Number of Shares: 6,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: O.B. Service Name: Nivel Holdings Ltd.
Number of Shares: 750,000 Number of Shares: 50,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxxxxx X. Xxxxxx Name: Xxxxxxx Xxxx
Number of Shares: 1,,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxxxxxxx XxXxxxxx Name: Xxxx Xxxxxx
Number of Shares: 1,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxx Xxxxxx Name: Xxxxx xXxxxx
Number of Shares: 2,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxxx Xxxxxxx Name: Xxxx Xxxxxx
Number of Shares: 2,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
15
Name: Xxxxx Xxxxxxx Name: Xxxxxx Xxxxxxx
Number of Shares: 1,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxxx Xxxxxxx Name: Xxxxxxxx Xxxxxx
Number of Shares: 1,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxx Xxxx Snowsell Law Corp Name: Xxx Xxxxxxx
Number of Shares: 2,000 Number of Shares: 1,000
Date: Aug 7, 2002 Date: Aug 7, 2002
Name: Xxxxxx Xxxxxxx
Number of Shares: 1,000
Date: Aug 7, 2002
16
EXHIBIT A
---------
THIS EXHIBIT is attached to and made a part of that certain Agreement
and Plan of Reorganization dated August 7, 2002 between and among WAVE
XXXXX.XXX. INC. (the "Company") and BETTER CALL HOME, INC. ("BCH")
Legal Opinion
-------------
The legal opinion shall contain the following:
1. The Company [BCH] is a corporation duly organized, validly existing,
and in good standing under the laws of the State of Nevada [Nevada].
2. The authorized capital stock of the Company [BCH] and the shares of
common stock of the Company [BCH] are as set forth in the Company's
[BCH's] representations. All outstanding shares of the Company's
[BCH's] common stock are duly and validly authorized and issued, are
fully paid and nonassessable, and have not been issued in violation of
any preemptive rights of stockholders, if any. To the knowledge of such
counsel, there is no existing option, warrant, call, subscription, or
other agreement or commitment obligating the Company [BCH] to issue or
sell, or to purchase or redeem, any shares of its capital stock other
than those represented by the Company [BCH] to BCH [the Company] in
this Agreement.
3. To their knowledge, all consents or approvals by third parties required
in connection with the execution and consummation of this Agreement
have been duly obtained and no consents or approvals by any additional
third parties or by any governmental agency are required in connection
therewith.
4. To their knowledge, the execution of this Agreement and the
transactions contemplated hereby will no result in the breach of any
term or provision of, or constitute a default under, any provision or
restriction of any indenture, agreement, or other instrument to which
the Company [BCH] is a party or by which it is bound, nor will it
conflict with the provisions of the Articles of Incorporation or Bylaws
of the Company [BCH].
5. All corporate action (including the Board of Directors and approval by
the Stockholders) required to authorize the transactions contemplated
by this Agreement have been duly and properly taken.
6. The Agreement have been duly authorized, executed, and delivered by the
Company [BCH] and constitutes a valid agreement, legally binding upon
the Company [BCH} and enforceable in accordance with its terms.
17
7. The Stockholders of BCH have full right and power to transfer and
deliver their shares pursuant to this Agreement, free and clear of any
liens, encumbrances, restrictions or claims.
Additional items for inclusion in opinion provided by Company's
counsel:
1. The Company has filed with the Securities Exchange Commission
and any applicable state securities agency all reports or
other documents required of it to assert and claim an
exemption from the registration provisions of the Securities
Act of 1933, as amended, and any applicable state securities
laws with respect to the issuance to the shareholders of BCH
of the Company's Common Shares, if required.
EXHIBIT B
---------
THIS EXHIBIT is attached to and made a part of that certain Agreement
and Plan of Reorganization dated July__, 2002 between and among WAVE XXXXX.XXX.
INC. (the "Company") and BETTER CALL HOME, INC. ("BCH")
Ownership List
--------------
The following is the name and address of each BCH shareholder, together
with the number of his shares of BCH's common stock, and the pro-rata amount of
the Company's 16,000,000 Common Shares which the Company shall issue to such
shareholder in accordance with the terms of the above referenced Agreement:
BCH Shareholder Shares of BCH Shares of Common
Name and Address Common Stock Capital Stock
VocalScape Networks, Inc 176,000 2,816,000
0000 Xxxxxxxx Xxxxxx Xxxxxxxxx
XX Xxxxxx X0X 0X0
Xxxxxxx Xxxx 1,000 16,000
#620 - 000 Xxxx 00xx Xxxxxx
Xxxxxxxxx XX Xxxxxx X00 0X0
Nivel Holdings Ltd. 50,000 000,000
Xxxxx Xxxxxxxx
Xxxxx 0-00, 0xx Xxxx
XX Xxx 000-0000
Xxx Xxxxxx Xx Escazu
San Xxxx Xxxxx Rica
Xxxxxxxxx XxXxxxxx 1,000 16,000
0000 Xxxxx Xxxxx
Xxxxxxxx XX Xxxxxx X0X 0X0
Xxxx Xxxxxx 2,000 32,000
000 Xxxx 00xx Xxx
Xxxxxxxxx XX Xxxxxx X0X 0X0
Xxxxx Xxxxxxx 2,000 32,000
0000 Xxxxxx Xxxxxx
Xxxxxxx XX Xxxxxx X0X 0X0
18
BCH Shareholder Shares of BCH Shares of Common
Name and Address Common Stock Capital Stock
Xxxxxxx Xxxxxx
000 xxxx 00xx Xxx
Xxxxxxxxx XX Xxxxxx X0X 0X0 1,000 16,000
Xxxxx xXxxxx 1,000 16,000
000 xxxx 00xx Xxx
Xxxxxxxxx XX X0X 0X0
Xxxxxxx X Xxxxxx 1,000 16,000
000 Xxxxx Xxxxx
0000 Xxxxxx Xxxx
Xxxxxxxx XX X0X 0X0
Confederated Capital Corp. 6,000 96,000
XXX0, Xxxxxx Xxxxx
Xxxx Xxxxxx, Xxxxx Xxxx
Turk & Caicos Islands
BWI
O.B. Services 750,000 12,000,000
Xxxxx Xxxxxxx 1,000 16,000
000 xxxx 00xx Xxx
Xxxxxxxxx XX Xxxxxx X0X 0X0
Xxxx Xxxx Snowsell Law Corp 2,000 32,000
410 0000 Xxxx Xxxxxxxx
Xxxxxxxxx XX Xxxxxx X0X0X0
Xxxx Xxxxxx 1,000 16,000
0000 Xxxxxxxxx Xxx
Xxxxxxx XX X0X 0X0
Xxxxxx Xxxxxxx 1,000 16,000
0000 000xx Xxxxxx
Xxxxx XX Xxxxxx X0X 0X0
Xxx Xxxxxxx 1,000 16,000
0000 000xx Xxxxxx
Xxxxxxx XX Xxxxxx X0X 0X0
19
BCH Shareholder Shares of BCH Shares of Common
Name and Address Common Stock Capital Stock
Xxxxxx Xxxxxxx 1,000 16,000
0000 Xxxxxx Xxxxxx
Xxxxxxx XX Xxxxxx X0X 0X0
Xxxxx Xxxxxxx 1,000 16,000
#00 0000 Xxxxxx Xxxxxx
Xxxx Xxxxxxxxx XX Xxxxxx X0X 0X0
Xxxxxxxx Xxxxxx 1,000 16,000
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx XX X0X 0X0
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