AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is dated
August 5, 1999, and is by and between Las Vegas Airlines, Inc., a Delaware
corporation (the "Company") and Lasv Enterprises, Inc., a California corporation
("Lasv").
R E C I T A L S
WHEREAS, the shareholders of Lasv ("Shareholders") own the shares of
capital stock of Lasv as set forth in Schedule 1 attached hereto, constituting
all of the issued and outstanding stock of Lasv (the "Lasv Shares");
WHEREAS, the Company is a public company, required to file reports
under Section 13 of the Securities Exchange Act of 0000 (xxx "Xxxxxxxx Xxx");
WHEREAS, the Company desires to acquire all of the Lasv Shares, and the
Shareholders desire to exchange all of the Lasv Shares for shares of voting
common stock of the Company, in a transaction that qualifies under Section
368(a) (1)(B) of the Internal Revenue Code of 1986, as amended (the "Code").
A G R E E M E N T
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and in reliance upon the representations and warranties
hereinafter set forth, the parties agree as follows:
I. EXCHANGE OF THE SHARES AND CONSIDERATION
1.01. Shares Being Exchanged.
Effective at the closing of
this Agreement (the "Closing"), and subject to the terms and conditions of this
Agreement the
Shareholders shall assign, transfer and deliver to the Company all of the Lasv
Shares which they
own.
1.02. Consideration. Subject to the terms and conditions of this
Agreement, and in consideration of the assignment and delivery of Lasv Shares to
the Company, the Company shall at Closing issue to the Shareholders a number of
shares of voting common stock of the Company, $.001 par value per share (the
"Company Shares"), equal to the number of shares set forth opposite the
Shareholder's name on Schedule 1 attached hereto, and shall issue a total of
16,000,000 Company Shares;
1.03. Closing. The Closing of the
transaction contemplated
by this Agreement (the "Closing") shall take place sixty days after the date
hereof and the
completion of all due diligence.
1.04. Deliveries. Within 5 days of
the execution and delivery
of this Agreement, the parties are delivering the following documents:
1.04(a). The items and
documents set forth in Sections
1.01 and 1.02.
1.04(b). The Company Shares
described in Section
1.02
1.04(c). The Company shall
deliver the resignations of
all of its current officers and directors, and a board resolution
electing Xxxxxxx Xxxx, Xxxxxxx Xxxx and Xxxxx Xxxxxx to the Board of
Directors of the Company.
1.05. Filings. Following with the
Closing, the Company shall
file the following documents:
1.05(a). A Current Report on
Form 8-K with the U.S.
Securities and Exchange Commission, reporting the transactions set
forth in this Agreement, any change of auditors, or other events
required to be reported in such report.
1.05(b). A Form 3 report of
beneficial ownership with
the U.S. Securities and Exchange Commission with respect to each
director, executive officer or greater than 10% holder of Company
Shares, signed by such director, executive officer or shareholder, as
the case may be.
1.05(c). A Schedule 13D with
the U.S. Securities and
Exchange Commission for each person who is required to file such form
as a result of obtaining greater than 5% beneficial ownership of the
Company's Common Stock as a result of the transactions contemplated by
this Agreement.
II. REPRESENTATIONS AND WARRANTIES OF LASV
Lasv represents and warrants to the Company as follows, as of the date
of this Agreement and as of the Closing:
2.01. Organization.
2.01(a). Lasv is a corporation
duly organized, validly
existing and in good standing under the laws of the State of
California; Lasv has the corporate power and authority to carry on its
business as presently conducted; and Lasv is qualified to do business
in all jurisdictions where the failure to be so qualified would have a
material adverse effect on its business.
2.02. Capitalization.
2.02(a). The authorized
capital stock and the issued and
outstanding shares of Lasv is as set forth on Exhibit 2.02(a). All of
the issued and outstanding shares of Lasv are duly authorized, validly
issued, fully paid and nonassessable.
2.02(b). Except as set forth
in Exhibit 2.02(b) there are
no outstanding options, warrants, or rights to purchase any securities
of Lasv.
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2.03. Subsidiaries and Investments. Lasv does not own any capital
stock or have any
interest in any corporation, partnership or other form of business organization,
except as described
in Exhibit 2.03 hereto.
2.04. Financial Statements. The unaudited financial statements of Lasv
as of and for the two years ended December 31, 1998, including the balance sheet
as of December 31, 1998 and the related statement of operations for the period
then ended (the "Financial Statements") present fairly the financial position
and results of operations of Lasv, on a consistent basis. The financial records
of Lasv are of such a character and quality that an unqualified (except as to
going concern) audit of the Lasv Financial Statements may be performed within 75
days of the Closing.
2.05. No Undisclosed Liabilities. Other than as described in Exhibit
2.05 attached hereto, Lasv is not subject to any material liability or
obligation of any nature, whether absolute, accrued, contingent, or otherwise
and whether due or to become due, which is not reflected or reserved against in
the Financial Statements, except those incurred in the normal course of
business.
2.06. Absence of Material Changes. Since December 31, 1998, except
as described
in any Exhibit attached hereto or as required or permitted under this Agreement,
there has not
been:
2.06(a). any material adverse
change in the condition
(financial or otherwise) of the properties, assets, liabilities or
business of Lasv, except changes in the ordinary course of business
which, individually and in the aggregate, have not been materially
adverse;
2.06(b). any redemption,
purchase or other acquisition
of any shares of the capital stock of Lasv, or any issuance of any
shares of capital stock or the granting, issuance or exercise of any
rights, warrants, options or commitments by Lasv relating to their
authorized or issued capital stock; or
2.06(c). any change or
amendment to the Articles of
Incorporation of Lasv.
2.07. Litigation. Except as set forth in Exhibit 2.07 attached hereto,
there is no litigation, proceeding or investigation pending or threatened
against Lasv affecting any of its properties or assets against any officer,
director, or stockholder of Lasv that might result, either in any case or in the
aggregate, in any material adverse change in the business, operations, affairs
or condition of Lasv or its properties or assets, or that might call into
question the validity of this Agreement, or any action taken or to be taken
pursuant hereto.
2.08. Title To Assets. Lasv has good and marketable title to all of its
assets and properties now carried on its books including those reflected in the
balance sheets contained in the Financial Statements, free and clear of all
liens, claims, charges, security interests or other encumbrances, except as
described in Exhibit 2.08 attached hereto or any other Exhibit.
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2.09. Transactions with Affiliates, Directors and Shareholders. Except
as set forth in Exhibit 2.09 attached hereto, there are and have been no
contracts, agreements, arrangements or other transactions between Lasv, and any
officer, director, or stockholder of Lasv, or any corporation or other entity
controlled by the Shareholders, a member of the Shareholders' families, or any
affiliate of the Shareholders.
2.10. No Conflict. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with or
result in a breach of any term or provision of, or constitute a default under,
the Articles of Incorporation or Bylaws of Lasv, or any agreement, contract or
instrument to which Lasv is a party or by which it or any of its assets are
bound.
2.11. Disclosure. To the actual knowledge of Lasv, neither this
Agreement, the Financial Statements nor any other agreement, document,
certificate or written or oral statement furnished to the Company by or on
behalf of Lasv in connection with the transactions contemplated hereby, contains
any untrue statement of a material fact or when taken as a whole omits to state
a material fact necessary in order to make the statements contained herein or
therein not misleading.
2.12. Authority. Lasv has full power and authority to enter into this
Agreement and to carry out the transactions contemplated herein. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby, have been duly authorized and approved by the Board of
Directors of Lasv and no other corporate proceedings on the part of Lasv are
necessary to authorize this Agreement and the transactions contemplated hereby.
III. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Lasv as follows, as of
the date of this Agreement and as of the Closing:
3.01. Organization.
3.01(a). The Company is a
corporation duly organized,
validly existing, and in good standing under the laws of the State of
Delaware; has the corporate power and authority to carry on its
business as presently conducted; and is qualified to do business in all
jurisdictions where the failure to be so qualified would have a
material adverse effect on the business of the Company.
3.01(b). The copies of the
Certificate of Incorporation,
of the Company, as certified by the Secretary of State of Delaware, and
the Bylaws of the Company are complete and correct copies of the
Certificate of Incorporation and the Bylaws of the Company as amended
and in effect on the date hereof. All minutes of meetings and actions
in writing without a meeting of the Board of Directors and shareholders
of the Company are contained in the minute book of the Company and no
minutes or actions in writing without a meeting have been included in
such minute book since such delivery to Lasv that have not also been
delivered to Lasv.
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3.02. Capitalization of the Company. The authorized capital stock of
the Company consists of 20,000,000 shares of Common Stock, par value $.001 per
share, of which 3,977,800 shares are outstanding, and 1,000,000 shares of
preferred stock, none of which is outstanding. All outstanding shares are duly
authorized, validly issued, fully paid and non-assessable. Following the
issuance of Company Shares, the capitalization of the Company shall be
19,977,800 shares of common stock.
3.03. Subsidiaries and Investments. The Company does not own any
capital stock
or have any interest in any corporation, partnership, or other form of
business organization.
3.04. Authority. The Company has full power and authority to enter into
this Agreement and to carry out the transactions contemplated herein. The
execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the issuance of the Company Shares in accordance with
the terms hereof, have been duly authorized and approved by the Board of
Directors of the Company and no other corporate proceedings on the part of
Company are necessary to authorize this Agreement, the transactions contemplated
hereby and the issuance of the Company Shares in accordance with the terms
hereof.
3.05. No Undisclosed Liabilities. Other than as described in Exhibit
3.05 attached
hereto, the Company is not subject to any material liability or obligation of
any nature, whether
absolute, accrued, contingent, or otherwise and whether due or to become due.
3.06. Litigation. There is no litigation, proceeding or investigation
pending or to the knowledge of the Company, threatened against the Company
affecting any of its properties or assets, or, to the knowledge of the Company,
against any officer, director, or stockholder of the Company that might result,
either in any case or in the aggregate, in any material adverse change in the
business, operations, affairs or condition of the Company or any of its
properties or assets, or that might call into question the validity of this
Agreement, or any action taken or to be taken pursuant hereto.
3.07. Title To Assets. The Company has good and marketable title to all
of its assets and properties now carried on its books including those reflected
in the balance sheet contained in the Company's financial statements, free and
clear of all liens, claims, charges, security interests or other encumbrances,
except as described in the balance sheet included in the Company's financial
statements or on any Exhibits attached hereto.
3.08. Contracts and Undertakings. Exhibit 3.08 attached hereto contains
a list of all contracts, agreements, leases, licenses, arrangements, commitments
and other undertakings to which the Company is a party or by which it or its
property is bound. Each of said contracts, agreements, leases, licenses,
arrangements, commitments and undertakings is valid, binding and in full force
and effect. The Company is not in material default, or alleged to be in material
default, under any contract, agreement, lease, license, commitment, instrument
or obligation and, to the knowledge of the Company, no other party to any
contract, agreement, lease, license, commitment, instrument or obligation to
which the Company is a party is in default thereunder nor, to the knowledge of
the Company, does there exist any condition or event which, after notice or
lapse of time or both, would constitute a default by any party to any such
contract, agreement, lease, license, commitment, instrument or obligation.
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3.09. Underlying Documents. Copies of all documents described in any
Exhibit attached
hereto (or a summary of any such contract, agreement or commitment, if oral)
have been made
available to Lasv and are complete and correct and include all amendments,
supplements or
modifications thereto.
3.10. Transactions with Affiliates, Directors and Shareholders. Except
as set forth in Exhibit 3.10 hereto, there are and have been no contracts,
agreements, arrangements or other transactions between the Company, and any
officer, director, or 5% stockholder of the Company, or any corporation or other
entity controlled by any such officer, director or 5% stockholder, a member of
any such officer, director or 5% stockholder's family, or any affiliate of any
such officer, director or 5% stockholder.
3.11. No Conflict. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with or
result in a breach of any term or provision of, or constitute a default under,
the Certificate of Incorporation or Bylaws of the Company, or any agreement,
contract or instrument to which the Company is a party or by which it or any of
its assets are bound.
3.12. Disclosure. To the actual knowledge of the Company, neither this
Agreement nor any other agreement, document, certificate or written or oral
statement furnished to Lasv and the Shareholders by or on behalf of the Company
in connection with the transactions contemplated hereby, contains any untrue
statement of a material fact or when taken as a whole omits to state a material
fact necessary in order to make the statements contained herein or therein not
misleading.
3.13. Financial Statements. The financial statements of the Company set
forth in its Form 10K-SB for the year ended September 30, 1998 and its Form
10-QSB for the quarter ended June 30, 1999 present fairly the financial position
and results of operations of the Company, on a consistent basis.
3.14. Absence of Material Changes.
Since June 30, 1999,
except as described in any Exhibit hereto or as required or permitted under
this Agreement, there
has not been:
3.14(a). any material change
in the condition (financial
or otherwise) of the properties, assets, liabilities or business of
Company, except changes in the ordinary course of business which,
individually and in the aggregate, have not been materially adverse.
3.14(b). any redemption,
purchase or other acquisition
of any shares of the capital stock of Company, or any issuance of any
shares of capital stock or the granting, issuance or exercise of any
rights, warrants, options or commitments by Lasv relating to their
authorized or issued capital stock.
3.14(c). any amendment to the
Certificate of
Incorporation of Company.
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IV. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
All representations, warranties and covenants of the Company and Lasv
contained herein shall survive the consummation of the transactions contemplated
herein and remain in full force and effect.
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V. CONDITIONS TO CLOSING
5.01. Conditions to Obligation of
Lasv. The obligations of
Lasv under this Agreement shall be subject to each of the following conditions:
5.01(a). The representations
and warranties of Company
herein contained shall be true in all material respects at the Closing
with the same effect as though made at such time. Company shall have
performed in all material respects all obligations and complied in all
material respects, to its actual knowledge, with all covenants and
conditions required by this Agreement to be performed or complied with
by it at or prior to the Closing.
5.01(b). No injunction or
restraining order shall be in
effect, and no action or proceeding shall have been instituted and, at
what would otherwise have been the Closing, remain pending before a
court to restrain or prohibit the transactions contemplated by this
Agreement.
5.01(c). All statutory
requirements for the valid
consummation by Company of the transactions contemplated by this
Agreement shall have been fulfilled. All authorizations, consents and
approvals of all governments and other persons required to be obtained
in order to permit consummation by Company of the transactions
contemplated by this Agreement shall have been obtained.
5.02. Conditions to Obligations of
Company. The obligation
of Company under this Agreement shall be subject to the following conditions:
5.02(a). The representations
and warranties of Lasv
herein contained shall be true in all material respects as of the
Closing, and shall have the same effect as though made at the Closing;
Lasv shall have performed in all material respects all obligations and
complied in all material respects, to its actual knowledge, with all
covenants and conditions required by this Agreement to be performed or
complied with by it prior to the Closing.
5.02(b). No injunction or
restraining order shall be in
effect prohibiting this Agreement, and no action or proceeding shall
have been instituted and, at what would otherwise have been the
Closing, remain pending before the court to restrain or prohibit the
transactions contemplated by this Agreement.
5.02(c). All statutory
requirements for the valid
consummation by Lasv of the transactions contemplated by this Agreement
shall have been fulfilled. All authorizations, consents and approvals
of all governments and other persons required to be obtained in order
to permit consummation by Lasv of the transactions contemplated by this
Agreement shall have been obtained.
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VI. CERTAIN AGREEMENTS
6.01. Reporting Requirements. The Company shall file all reports
required by Section 13 of the Securities Exchange Act of 1934 and shall maintain
its books and records in accordance with Sections 12 and 13 thereof. The parties
agree that the failure of the Company to make such filings with the Securities
and Exchange Commission shall constitute a material breach of this Agreement.
VII. MISCELLANEOUS
7.01. Finder's Fees, Investment Banking Fees. Neither Lasv nor the
Company have retained or used the services of any person, firm or corporation in
such manner as to require the payment of any compensation as a finder or a
broker in connection with the transactions contemplated herein.
7.02. Tax Treatment. The transaction contemplated hereby is intended to
qualify as a so-called "tax-free" reorganization under the provisions of Section
368 of the Internal Revenue Code. The Company and Lasv acknowledge, however,
that they each have been represented by their own tax advisors in connection
with this transaction; that neither has made any representation or warranty to
the other with respect to the treatment of such transaction or the effect
thereof under applicable tax laws, regulations, or interpretations; and that no
attorney's opinion or private revenue ruling has been obtained with respect to
the effects thereof under the Internal Revenue Code of 1986, as amended.
7.03. Further Assurances. From time to time, at the other party's
request and without further consideration, each of the parties will execute and
deliver to the others such documents and take such action as the other party may
reasonably request in order to consummate more effectively the transactions
contemplated hereby.
7.04. Parties in Interest. Except as otherwise expressly provided
herein, all the terms and provisions of this Agreement shall be binding upon,
shall inure to the benefit of and shall be enforceable by the respective heirs,
beneficiaries, personal and legal representatives, successors and assigns of the
parties hereto.
7.05. Entire Agreement; Amendments. This Agreement, including the
Schedules, Exhibits and other documents and writings referred to herein or
delivered pursuant hereto, which form a part hereof, contains the entire
understanding of the parties with respect to its subject matter. There are no
restrictions, agreements, promises, warranties, covenants or undertakings other
than those expressly set forth herein or therein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to its
subject matter. This Agreement may be amended only by a written instrument duly
executed by the parties or their respective successors or assigns.
7.06. Headings, Etc. The section and paragraph headings contained in
this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretations
of this Agreement.
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7.07. Pronouns. All pronouns and
any variations thereof shall
be deemed to refer to the masculine, feminine or neuter, singular or plural,
as the identity of
the person, persons, entity or entities may require.
7.08. Counterparts. This Agreement may be executed in several
counterparts, each
of which shall be deemed an original but all of which together shall constitute
one and the same
instrument.
7.09. Governing Law. This Agreement shall be governed by the laws of
the State of
California (excluding conflicts of laws principles) applicable to contracts to
be performed in the
State of California.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the parties hereto as the date first above written.
LAS VEGAS AIRLINES, INC. LASV ENTREPRISES, INC.
By: By:
Name: Name:
Title: Title:
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