EXHIBIT 2.1
STOCK EXCHANGE AGREEMENT AND PLAN OF REORGANIZATION
This STOCK EXCHANGE AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement ")
dated as of May 4, 2001, by and among XXXXXXXXX RESEARCH CORPORATION, a Nevada
corporation whose principal office is located at 00000 Xxxx Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxx 00000 ("GRC"); IMAGINON, INC., a Delaware corporation whose
principal office is located at 0000 Xxxxxx Xxxxxx, Xxx Xxxxxx, XX 00000
("Seller"); and WIRELESS WEB DATA, INC., a Delaware corporation whose principal
office is located at 0000 Xxxxxx Xxxxxx, Xxxxx 0, Xxx Xxxxxx, Xxxxxxxxxx 00000
and a wholly-owned subsidiary of Seller ("WWDI").
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R E C I T A L S
A. WWDI, a wholly owned subsidiary of Seller, is in the business of
developing wireless web data server software for the wireless devices
marketplace. WWDI is authorized to issue Fifteen Million (15,000,000) shares of
Common Stock, $0.001 par value per share, of which Six Million (6,000,000)
shares are issued and outstanding, and Five Million (5,000,000) shares of
Preferred Stock, $0.001 par value per share, of which no shares are issued and
outstanding.
B. Seller owns Six Million (6,000,000) shares of Common Stock of WWDI,
which constitutes One Hundred percent (100%) of the issued and outstanding
shares of WWDI.
C. GRC is a publicly quoted corporation with nominal assets and
liabilities. GRC is authorized to issue Fifty Million (50,000,000) shares of
Common Stock, $0.001 par value per share, of which Four Million Seven Hundred
and Sixty Eight Thousand (4,768,000) shares are issued and outstanding, and Five
Million (5,000,000) preferred shares, none of which are issued or outstanding.
D. GRC desires to acquire one hundred percent (100%) of the shares
issued and outstanding stock of WWDI, in consideration for which GRC shall issue
to Seller, as WWDI's sole shareholder, twenty Million (20,000,000) shares of
its Common Stock, in a tax-free reorganization pursuant to Section 368(a)(1)(B)
of the Internal Revenue Code ("Code").
AGREEMENT
NOW, THEREFORE, in consideration of the terms, conditions, agreements and
covenants contained herein, and in reliance upon the representations and
warranties contained in this Agreement, the parties hereto agree as follows.
I.
ACQUISITION OF WWDI SHARES BY GRC
1.1 ACQUISITION OF WWDI. In the manner and subject to the terms and
conditions set forth herein, GRC shall acquire from Seller , one hundred percent
(100%) of the issued and outstanding shares of WWDI (the "WWDI Shares").
1.2 EFFECTIVE DATE. If all of the conditions precedent to the obligations
of each of the parties hereto as hereinafter set forth shall have been satisfied
or shall have been waived, the transactions set forth herein (the "Exchange")
shall become effective on the Closing Date as defined herein.
1.3 CONSIDERATION.
(a) In connection with the acquisition of the WWDI Shares, GRC shall issue
to Seller Twenty Million (20,000,000) shares of GRC (the "GRC Shares"). Such
shares at the Closing shall equal eighty and three-quarters percent (80.75%) of
the outstanding shares of GRC.
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b) If, between the date of this Agreement and the Closing Date,
the outstanding shares of GRC Common Stock are changed into a different number
or class of shares by reason of any stock split, division or subdivision of
shares, stock dividend, reverse stock split, consolidation of shares,
reclassification, recapitalization, or other similar transaction, then the
number of shares of Common Stock referenced in Section 1.3(a), above, shall be
appropriately adjusted to constitute 80.75% of the issued and outstanding shares
of capital stock of GRC as of the Closing Date.
(c) No fractional shares of GRC Common Stock shall be issued in
connection with the Exchange, and no certificates or scrip for any such
fractional shares shall be issued.
1.4 EFFECT OF STOCK EXCHANGE. As of the Closing Date, all of the
following shall occur:
(a) The Certificates of Incorporation of WWDI and GRC, as in
effect on the Effective Date, shall continue in effect without change or
amendment.
(b) The Bylaws of WWDI and GRC, as in effect on the Closing Date,
shall continue in effect without change or amendment.
(c) Upon the Closing Date, Xxxxx Xxxxxxx shall be appointed
President and Chief Financial Officer of GRC, and Xxxxx Xxxxx shall be appointed
corporate Secretary. Xxxxx Xxxxxxx, Xxxxx Xxxxxxxx and Xxxxx Xxxxx shall be
appointed to the Board of Directors of GRC.
(d) Upon the Closing Date, GRC will issue warrants for its shares
of Common Stock in accordance with Schedule 1.4(e) hereto.
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1.5 DISCLOSURE SCHEDULES. Simultaneously with the execution of this
Agreement: (a) GRC shall deliver a schedule relating to GRC (the "GRC Disclosure
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Schedule"), and (b) Seller and WWDI shall deliver a schedule relating to Seller
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and WWDI (the "Seller and WWDI Disclosure Schedule" and collectively with the
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GRC Disclosure Schedule, the "Disclosure Schedules") setting forth the matters
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required to be set forth in the Disclosure Schedules as described elsewhere in
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this Agreement. The Disclosure Schedules shall be deemed to be part of this
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Agreement.
1.6 FURTHER ACTION. If, at any time after the Closing Date, any
further action is determined by Seller to be necessary or desirable to carry out
the purposes of this Agreement or to vest Seller with full right, title and
possession of and to the GRC Shares in accordance with the provisions of this
Agreement, the officers and directors of Seller shall be fully authorized, in
the name of GRC, to take such action.
1.7 STATUS OF AFFILIATES. Xxxxxxx X. Xxxxxx and Xxxx X. Xxxxxxx Xx.
currently are affiliates of GRC, due to either stock ownership, position with
GRC, or both. GRC, Seller and WWDI acknowledge that the shares of GRC held by
Xxxxxx and Xxxxxxx were issued pursuant to Rule 504 of Regulation D under the
Securities Act of 1933, as amended, that such shares have been outstanding more
than six months, and that such shares are not and have never been restricted
securities. GRC, Seller and WWDI agree that, following the Closing of the
Exchange, Xxxxxx and Xxxxxxx, who currently are affiliates of GRC, will cease to
be affiliates of GRC for any purpose, and that the shares of GRC held by them
and their respective affiliates will not be subject to the resale requirements
of Rule 144 or any other restriction. Xxxxxx and Xxxxxxx shall be deemed third
party beneficiaries of this provision.
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II
CONDUCT OF BUSINESS PENDING CLOSING; STOCKHOLDER APPROVAL
GRC, Seller and WWDI covenant that between the date hereof and the Closing
Date (as hereinafter defined):
2.1 ACCESS BY SELLER. GRC shall afford to Seller, WWDI, and to Seller
and WWDI's counsel, accountants and other representatives, throughout the period
prior to the Closing Date, full access, during normal business hours, to (a) all
of the books, contracts and records of GRC, and shall furnish Seller and WWDI,
during such period, with all information concerning GRC that Seller or WWDI may
reasonably request and (b) the properties of GRC in order to conduct inspections
at Seller and WWDI's expense to determine that GRC is operating in material
compliance with all applicable federal, state and local and foreign statutes,
rules and regulations, and that GRC's assets are substantially in the condition
and of the capacities represented and warranted in this Agreement. Any such
investigation or inspection by Seller or WWDI shall not be deemed a waiver of,
or otherwise limit, the representations, warranties and covenants contained
herein. Seller and WWDI shall grant identical access to GRC and its agents.
2.2 CONDUCT OF BUSINESS. During the period from the date hereof to the
Closing Date, the business of GRC shall be operated by GRC in the usual and
ordinary course of such business and in material compliance with the terms of
this Agreement. Without limiting the generality of the foregoing:
(a) GRC shall use its reasonable efforts to (i) keep available the
services of the present agents of GRC; (ii) complete or maintain all existing
arrangements including but not limited to filings, licensing, affiliate
arrangements, transferals, leases and other arrangements in full force and
effect in accordance with their existing terms; (iii) maintain the integrity of
all confidential information of GRC; and (iv) comply in all material respects
with all applicable laws; and
(b) GRC shall not (i) sell or transfer any of its assets or
property; (ii) shall not make any distribution, whether by dividend or
otherwise, to any of its stockholders or employees except for compensation to
employees and payments to associated companies for goods and services, in the
usual and ordinary course of business; (iii) not declare any dividend or other
distribution; (iv) redeem or otherwise acquire any shares of its capital stock
or other securities; (v) issue or grant rights to acquire shares of its capital
stock or other securities; or (vi) agree to do any of the foregoing.
2.3 EXCLUSIVITY TO SELLER AND WWDI. GRC and its officers, directors,
representatives and agents, from the date hereof until the Closing Date (unless
this Agreement shall be earlier terminated as hereinafter provided), shall not
hold discussions with any person or entity, other than Seller and WWDI or their
respective agents concerning the Exchange, nor solicit, negotiate or entertain
any inquiries, proposals or offers to purchase the business of GRC, nor the
shares of capital stock of GRC from any person other than Seller and WWDI, nor,
except in connection with the normal operation of GRC's respective business, or
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as required by law or as authorized in writing by Seller, disclose any
confidential information concerning GRC to any person other than Seller, WWDI
and Seller and WWDI's representatives or agents. Seller and WWDI shall from the
date hereof and until the Closing Date owe the identical obligations of
confidentiality and exclusivity to GRC concerning the Exchange as stated in this
Section.
2.4 STOCKHOLDER APPROVAL. The Board of Directors of GRC has determined
that the Exchange is fair to and in the best interests of its stockholders and
has approved and adopted this Agreement and the terms of the Exchange. This
Agreement constitutes, and all other agreements contemplated hereby will
constitute, when executed and delivered by GRC, the valid and binding obligation
of GRC, enforceable in accordance with their respective terms.
III
REPRESENTATIONS AND WARRANTIES OF GRC
Except as set forth in the GRC Disclosure Schedule, GRC represents and
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warrants to Seller and WWDI as follows, with the knowledge and understanding
that Seller and WWDI are relying materially upon such representations and
warranties.
3.1 ORGANIZATION AND STANDING. GRC is a corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada. GRC
has all requisite corporate power to carry on its business as it is now being
conducted and is duly qualified to do business as a foreign corporation and is
in good standing in each jurisdiction where such qualification is necessary
under applicable law except where the failure to qualify (individually or in the
aggregate) will not have any material adverse effect on the business or
prospects of GRC. The copies of the Articles of Incorporation, Bylaws and minute
books of GRC, as amended to date and made available to Seller and WWDI, are true
and complete copies of these documents as now in effect. The minute books of GRC
are accurate in all material respects.
3.2 CAPITALIZATION.
(a) The authorized capital stock of GRC, the number of shares of
capital stock which are issued and outstanding, and the par value thereof are as
set forth in the GRC Disclosure Schedule. All of such shares of capital stock
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that are issued and outstanding are duly authorized, validly issued and
outstanding, fully paid and nonassessable, and were not issued in violation of
the preemptive rights of any person. Other than as set forth in the GRC
Disclosure Schedule, there are no subscriptions, warrants, rights or calls or
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other commitments or agreements to which GRC is a party or by which it is bound,
pursuant to which GRC is or may be required to issue or deliver securities of
any class. Other than as set forth in the GRC Disclosure Schedule, there are no
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outstanding securities convertible or exchangeable, actually or contingently,
into common stock or any other securities of GRC.
(b) All outstanding shares of GRC capital stock have been issued and
granted in compliance with all applicable securities laws and other applicable
legal requirements.
3.3 SUBSIDIARIES. GRC owns no subsidiaries nor does it own or have an
interest in any other corporation, partnership, joint venture or other entity.
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3.4 AUTHORITY. GRC's Board of Directors has determined that the
Exchange is fair to and in the best interests of GRC's stockholders, and has
approved and adopted this Agreement and the terms of the Exchange and has
adopted a resolution recommending approval and adoption of this Agreement and
the Exchange by GRC's stockholders. This Agreement constitutes, and all other
agreements contemplated hereby will constitute, when executed and delivered by
GRC in accordance herewith, the valid and binding obligations of GRC,
enforceable in accordance with their respective terms.
3.5 ASSETS. GRC has no assets of any kind.
3.6 CONTRACTS AND OTHER COMMITMENTS. GRC is not a party to any
contracts or agreements other than the non-binding letter of intent with Seller
and WWDI.
3.7 LITIGATION. There is no claim, action, proceeding, or investigation
pending or, to its knowledge, threatened against or affecting GRC before or by
any court, arbitrator or governmental agency or authority which, in its
reasonable judgment, could have a material adverse effect on the operations or
prospects of GRC. There is no strike or unresolved labor dispute relating to
GRC's employees who, in its judgment, could have a material adverse effect on
the business or prospects of GRC. There are no decrees, injunctions or orders of
any court, governmental department, agency or arbitration outstanding against
GRC or asserted against GRC that has not been paid. There are no Tax liens upon
the assets of GRC. There is no valid basis, to the knowledge of GRC, except as
set forth in the GRC Disclosure Schedule, for any assessment, deficiency,
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notice, 30-day letter or similar intention to assess any Tax to be issued to GRC
by any governmental authority.
3.8 TAXES. For purposes of this Agreement, (A) "Tax" (and, with
correlative meaning, "Taxes") shall mean any federal, state, local or foreign
income, alternative or add- on minimum, business, employment, franchise,
occupancy, payroll, property, sales, transfer, use, value added, withholding or
other tax, levy, impost, fee, imposition, assessment or similar charge together
with any related addition to tax, interest, penalty or fine thereon; and (B)
"Returns" shall mean all returns (including, without limitation, information
returns and other material information), reports and forms relating to Taxes.
(a) GRC has duly filed all Returns required to be filed by it
other than Returns (individually and in the aggregate) where the failure to file
would have no material adverse effect on the business or prospects of GRC. All
such Returns were, when filed, and to the knowledge of GRC are, accurate and
complete in all material respects and were prepared in conformity with
applicable laws and regulations. GRC has paid or will pay in full or has
adequately reserved against all Taxes otherwise assessed against it through the
Closing Date.
(b) GRC is not a party to any pending action or proceeding by any
governmental authority for the assessment of any Tax, and, to the knowledge of
GRC, no claim for assessment or collection of any Tax related to GRC has been
asserted against GRC that has not been paid. There are no Tax liens upon the
assets of GRC. There is no valid basis, to the knowledge of GRC, except as set
forth in the GRC Disclosure Schedule, for any assessment, deficiency, notice,
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30-day letter or similar intention to assess any Tax to be issued to GRC by any
governmental authority.
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3.9 COMPLIANCE WITH LAWS AND REGULATIONS. GRC has complied and is
presently complying, in all material respects, with all laws, rules,
regulations, orders and requirements (federal, state and local and foreign)
applicable to it in all jurisdictions where the business of GRC is conducted or
to which GRC is subject, including, without limitation, all applicable federal
and state securities laws, civil rights and equal opportunity employment laws
and regulations, and all federal, antitrust, antimonopoly and fair trade
practice laws. There has been no assertion by any party that GRC is in violation
in any material respect of any such laws, rules, regulations, orders,
restrictions or requirements with respect to its operations and no notice in
that regard has been received by GRC.
3.10 HAZARDOUS MATERIALS. GRC has not violated, or received any written
notice from any governmental authority with respect to the violation of any law,
rule, regulation or ordinance pertaining to the use, maintenance, storage,
transportation or disposal of "Hazardous Materials." As used herein, the term
"Hazardous Materials" means any substance now or hereafter designated pursuant
to Section 307(a) and 311 (b)(2)(A) of the Federal Clean Water Act, 33 USC
Sec.Sec. 1317(a), 1321(b)(2)(A), Section 112 of the Federal Clean Air Act, 42
USC Sec. 3412, Section 3001 of the Federal Resource Conservation and Recovery
Act, 42 USC Sec. 6921, Section 7 of the Federal Toxic Substances Control Act, 15
USC Sec. 2606, or Section 101(14) and Section 102 of the Comprehensive
Environmental Response, Compensation and Liability Act, 42 USC Sec.Sec.
9601(14), 9602.
3.11 NO BREACHES. The making and performance of this Agreement will not
(i) conflict with or violate the Articles of Incorporation or the Bylaws of GRC,
(ii) violate any laws, ordinances, rules, or regulations, or any order, writ,
injunction or decree to which GRC is a party or by which GRC or any of its
businesses, or operations may be bound or affected or (iii) result in any breach
or termination of, or constitute a default under, or constitute an event which,
with notice or lapse of time, or both, would become a default under, or result
in the creation of any encumbrance upon any material asset of GRC under, or
create any rights of termination, cancellation or acceleration in any person
under, any Contract.
3.12 EMPLOYEES. GRC has no employees that are represented by any labor
union or collective bargaining unit.
3.13 FINANCIAL STATEMENTS. The GRC Disclosure Schedule contains audited
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balance sheets of GRC as of December 31, 2000 and related audited statements of
operations, cash flows and stockholders' equity of GRC for the periods ended at
such date (collectively the "Financial Statements"). The Financial Statements
present fairly, in all material respects, the financial position on the dates
thereof and results of operations of GRC for the periods indicated, prepared in
accordance with generally accepted accounting principles ("GAAP"), consistently
applied. There are no assets of GRC the value of which is materially overstated
in said balance sheets.
3.14 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as set forth in the
GRC Disclosure Schedule, since December 31, 2000 (the "Balance Sheet Dates"),
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there has not been:
(a) any material adverse change in the financial condition,
properties, assets, liabilities or business of GRC
(b) any material damage, destruction or loss of any material
properties of GRC, whether or not covered by insurance;
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(c) any material adverse change in the manner in which the
business of GRC and has been conducted;
(d) any material adverse change in the treatment and protection of
trade secrets or other confidential information of GRC; and
(e) any occurrence not included in paragraphs (a) through (d) of
this Section 3.14 which has resulted, or which GRC has reason to believe, might
be expected to result in a material adverse change in the business or prospects
of GRC.
3.15 GOVERNMENT LICENSES, PERMITS, AUTHORIZATIONS. GRC has all material
governmental licenses, permits, authorizations and approvals necessary for the
conduct of its business as currently conducted ("Licenses and Permits").
3.16 EMPLOYEE BENEFIT PLANS.
(a) The GRC Disclosure Schedule identifies each salary, bonus,
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material deferred compensation, material incentive compensation, stock purchase,
stock option, severance pay, termination pay, hospitalization, medical,
insurance, supplemental unemployment benefits, profit-sharing, pension or
retirement plan, program or material agreement.
(b) Except as set forth in GRC Disclosure Schedule, GRC has not
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maintained, sponsored or contributed to, any employee pension benefit plan (as
defined in Section 3(2) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) or any similar pension benefit plan under the laws of any
foreign jurisdiction.
(c) Except as set forth in the GRC Disclosure Schedule, neither
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the execution, delivery or performance of this Agreement, nor the consummation
of the Exchange or any of the other transactions contemplated by this Agreement,
will result in any bonus, golden parachute, severance or other payment or
obligation to any current or former employee or director of any of GRC, or
result in any acceleration of the time of payment, provision or vesting of any
such benefits. Without limiting the generality of the foregoing, the
consummation of the Exchange will not result in the acceleration or vesting of
any unvested GRC Options.
3.17 BUSINESS LOCATIONS. Other than as set forth in the GRC Disclosure
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Schedule, GRC does not own or lease any real or personal property in any state
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or country.
3.18 INTELLECTUAL PROPERTY. GRC owns no intellectual property of any
kind.
3.19 GOVERNMENTAL APPROVALS. Except as set forth in the GRC Disclosure
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Schedule, no authorization, license, permit, franchise, approval, order or
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consent of, and no registration, declaration or filing by GRC with, any
governmental authority, domestic or foreign, federal, state or local, is
required in connection with GRC's execution, delivery and performance of this
Agreement.
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3.20 TRANSACTIONS WITH AFFILIATES. Except as set forth in the GRC
Disclosure Schedule, GRC is not indebted for money borrowed, either directly or
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indirectly, from any of its officers, directors, or any Affiliate (as defined
below), in any amount whatsoever; nor are any of its officers, directors, or
Affiliates indebted for money borrowed from GRC; nor are there any transactions
of a continuing nature between GRC and any of its officers, directors, or
Affiliates not subject to cancellation which will continue beyond the Closing
Date, including, without limitation, use of the assets of GRC for personal
benefit with or without adequate compensation. For purposes of this Agreement,
the term "Affiliate" shall mean any person that, directly or indirectly, through
one or more intermediaries, controls or is controlled by, or is under common
control with, the person specified. As used in the foregoing definition, the
term (i) "control" shall mean the power through the ownership of voting
securities, contract or otherwise to direct the affairs of another person and
(ii) "person" shall mean an individual, firm, trust, association, corporation,
partnership, government (whether federal, state, local or other political
subdivision, or any agency or bureau of any of them) or other entity.
3.21 NO DISTRIBUTIONS. GRC has not made nor has any intention of making
any distribution or payment to any of its shareholders with respect to any of
its shares prior to the Closing Date.
3.22 LIABILITIES. GRC has no material direct or indirect indebtedness,
liability, claim, loss, damage, deficiency, obligation or responsibility, fixed
or unfixed, xxxxxx or inchoate, liquidated or unliquidated, secured or
unsecured, accrued, absolute, contingent or otherwise ("Liabilities"), whether
or not of a kind required by generally accepted accounting principles to be set
forth on a financial statement, other than (i) Liabilities fully and adequately
reflected or reserved against on the GRC Balance Sheet, (ii) Liabilities
incurred since the Balance Sheet Date in the ordinary course of the business of
GRC, or (iii) Liabilities otherwise disclosed in this Agreement, including the
exhibits hereto and Disclosure Schedule.
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3.23 ACCOUNTS RECEIVABLE. GRC has no accounts receivable.
3.24 NO OMISSIONS OR UNTRUE STATEMENTS. To the best of its knowledge no
representation or warranty made by GRC to Seller and WWDI in this Agreement, the
GRC Disclosure Schedule or in any certificate of a GRC officer required to be
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delivered to Seller pursuant to the terms of this Agreement contains or will
contain any untrue statement of a material fact, or omits or will omit to state
a material fact necessary to make the statements contained herein or therein not
misleading as of the date hereof and as of the Closing Date.
3.25 INSURANCE. GRC has no insurance policies in effect.
3.26 DISCLAIMER OF FURTHER WARRANTIES; ETC. Except as expressly set
forth in this Agreement and any Schedules and Exhibits hereto, neither Seller
nor WWDI has made any other representation or warranty to GRC in connection with
the Exchange. GRC's decision to enter into the Exchange is based upon its own
independent judgment and investigation and not on any representations and
warranties of Seller or WWDI other than those expressly stated in this Agreement
and in the Schedules and Exhibits hereto.
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IV
REPRESENTATIONS AND WARRANTIES OF SELLER AND WWDI
Except as set forth in the Seller SEC Documents, as defined below, Seller
and WWDI represent and warrant to GRC as follows as of the date hereof and as of
the Closing Date:
4.1 ORGANIZATION AND STANDING OF SELLER. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. The copies of the Articles of Incorporation and Bylaws of Seller, as
amended to date, and made available to GRC, are true and complete copies of
those documents as now in effect.
4.2 ORGANIZATION AND STANDING OF WWDI. WWDI is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and has the corporate power to carry on its business as now conducted
and to own its assets and is duly qualified to transact business as a foreign
corporation in each state where such qualification is necessary except where the
failure to qualify will not have a material adverse effect on the business or
prospects of WWDI. The copies of the Articles of Incorporation and By-laws of
WWDI, as amended to date, and made available to GRC, are true and complete
copies of those documents as now in effect.
4.3 STOCKHOLDER APPROVAL. The Board of Directors of Seller and WWDI
have determined that the Exchange is advisable and in the best interests of the
stockholders of Seller and WWDI.
4.4 NO CONFLICT. The making and performance of this Agreement will not
(i) conflict with the Certificate of Incorporation or the By-laws of Seller or
WWDI, (ii) violate any laws, ordinances, rules, or regulations, or any order,
writ, injunction or decree to which Seller or WWDI is a party or by which
Seller, WWDI or any of their material assets, business, or operations may be
bound or affected or (iii) result in any breach or termination of, or constitute
a default under, or constitute an event which, with notice or lapse of time, or
both, would become a default under, or result in the creation of any encumbrance
upon any material asset of Seller or WWDI, or create any rights of termination,
cancellation, or acceleration in any person under any material agreement,
arrangement, or commitment, or violate any provisions of any laws, ordinances,
rules or regulations or any order, writ, injunction, or decree to which Seller
or WWDI is a party or by which Seller or WWDI, or any of their material assets
may be bound.
4.5 PROPERTIES. Except as set forth in the Seller and WWDI Disclosure
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Schedule, Seller has good and marketable title to all of the WWDI Shares, free
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and clear of all liens, claims and encumbrances of third persons whatsoever, and
WWDI has good and marketable title to all of the assets and properties which it
purports to own as reflected on the balance sheet included in the WWDI Financial
Statements (as hereinafter defined), or thereafter acquired.
4.6 CAPITALIZATION OF WWDI. The authorized capital stock of WWDI
consists of Fifteen Million (15,000,000) shares of Common Stock, $0.001 par
value per share, of which Six Million (6,000,000) shares are issued and
outstanding, and Five Million (5,000,000) shares of Preferred Stock, $0.001 par
value per share, of which no shares are issued and outstanding. Such outstanding
shares of Common Stock are duly authorized, validly issued, fully paid, and
non-assessable. As of the date hereof, there were no outstanding options,
warrants or rights of conversion or other rights, agreements, arrangements or
commitments relating to the capital stock of WWDI or obligating WWDI to issue or
sell shares of Common Stock.
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4.7 GOVERNMENTAL APPROVAL; CONSENTS. Except for the reports required to
be filed in the future by Seller under the Securities Act, no authorization,
license, permit, franchise, approval, order or consent of, and no registration,
declaration or filing by Seller or WWDI with any governmental authority,
domestic or foreign, federal, state or local, is required in connection with
Seller and WWDI's execution, delivery and performance of this Agreement. Except
as set forth in the Seller and WWDI Disclosure Schedule, no consents of any
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other parties are required to be received by or on the part of Seller or WWDI to
enable Seller and WWDI to enter into and carry out this Agreement.
4.8 ADVERSE DEVELOPMENTS. Since December 31, 2000 there have been no
material adverse changes in the assets, liabilities, properties, operations or
financial condition of WWDI, and no event has occurred other than in the
ordinary and usual course of business or as set forth in or in the WWDI
Financial Statements which could be reasonably expected to have a materially
adverse effect upon WWDI.
4.9 TAXES. WWDI has duly filed all returns required to be filed by it
other than Returns which the failure to file would have no material adverse
effect on the business of WWDI. All such returns were, when filed, and to WWDI
's knowledge are, accurate and complete in all material respects and were
prepared in conformity with applicable laws and regulations. WWDI has paid or
will pay in full or have adequately reserved against all Taxes otherwise
assessed against it through the Closing Date. WWDI is not a party to any pending
action or proceeding by any governmental authority for the assessment of any
Tax, and, to the knowledge of WWDI, no claim for assessment or collection of any
Tax has been asserted against WWDI that have not been paid. There are no Tax
liens upon the assets of WWDI (other than the lien of personal property taxes
not yet due and payable). There is no valid basis, to WWDI 's knowledge, for any
assessment, deficiency, notice, 30-day letter or similar intention to assess any
Tax to be issued to WWDI by any governmental authority.
4.10 LITIGATION. Except as set forth on Seller and WWDI Disclosure
----------
Schedule, there is no material claim, action, proceeding, or investigation
--------
pending or, to their knowledge, threatened against or affecting Seller or WWDI
before or by any court, arbitrator or governmental agency or authority. There
are no material decrees, injunctions or orders of any court, governmental
department, agency or arbitration outstanding against Seller or WWDI.
4.11 COMPLIANCE WITH LAWS AND REGULATIONS. To the best of its
knowledge, WWDI has complied and is presently complying, in all material
respects, with all laws, rules, regulations, orders and requirements applicable
to it in all jurisdictions in which its operations are currently conducted or to
which it is currently subject.
4.12 GOVERNMENTAL LICENSES, PERMITS AND AUTHORIZATIONS. WWDI has all
governmental licenses, permits, authorizations and approvals necessary for the
conduct of its business as currently conducted. All such licenses, permits,
authorizations and approvals are in full force and effect, and no proceedings
for the suspension or cancellation of any thereof is pending or threatened.
15
4.13 LIABILITIES. To the best of their knowledge WWDI has no material
direct or indirect liabilities, as that term is defined in Section 3.23 ("WWDI
Liabilities"), whether or not of a kind required by generally accepted
accounting principles to be set forth on a financial statement, other than (i)
WWDI Liabilities fully and adequately reflected or reserved against on the WWDI
Balance Sheet, (ii) WWDI Liabilities incurred in the ordinary course of the
business of WWDI, and (iii) WWDI Liabilities otherwise disclosed in this
Agreement, including the Exhibits hereto.
4.14 NO OMISSION OR UNTRUE STATEMENT. To the best of their knowledge no
representation or warranty made by Seller or WWDI to GRC in this Agreement, in
the Seller and WWDI Disclosure Schedule or in any certificate of a WWDI officer
-------------------
required to be delivered to GRC pursuant to the terms of this Agreement contains
or will contain any untrue statement of a material fact, or omits or will omit
to state a material fact necessary to make the statements contained herein or
therein not misleading as of the date hereof and as of the Closing Date.
4.15 SELLER'S REPRESENTATIONS REGARDING GRC SHARES. (a) Seller is not
insolvent and will not be insolvent after selling and delivering the WWDI Shares
to GRC on the terms of this Agreement, and the GRC Shares will constitute new
consideration at least equal to the full and fair value of the WWDI Shares.
(b) Seller acknowledges that GRC has no assets or operating business
and that the GRC Shares are speculative and involve a high degree of risk,
including among many other risks that the GRC Shares will be restricted as
elsewhere described in this Agreement and will not be transferable unless first
registered under the Securities Act, of 1933 ("Act"), or pursuant to an
exemption from the Act's registration requirements.
(c) Seller acknowledges and agrees that it has been furnished with or
offered substantially the same kind of information regarding GRC and its
business, assets, financial condition and plan of operation as would be
contained in a registration statement and included prospectus prepared in
connection with a public offering of the GRC Shares. Seller has had an
opportunity to ask questions of and receive answers from GRC regarding its
business, assets, results of operations, financial condition and plan of
operation and the terms and conditions of the issuance of the GRC Shares.
(d) Seller is acquiring the GRC Shares for its own account, and not
for the account of any other person other than the benefit of Seller's
shareholders, and Seller has no current intent to make any resale, pledge,
hypothecation, distribution or public offering of the GRC Shares except as
permitted by applicable law.
(e) Seller, acting through its officers and directors and with the
assistance of counsel and other professional advisers, possesses such knowledge
and experience in financial, tax and business matters as to enable it to
utilize the information made available by GRC, to evaluate the merits and risks
of acquiring the GRC Shares and to make an informed investment decision with
respect thereto.
(f) Seller was not solicited by GRC or anyone on GRC's behalf to
enter into any transaction whatever, by any form of general solicitation or
general advertising, as those terms are defined in Regulation D under the Act.
16
4.16 CONTRACTS AND OTHER COMMITMENTS. Schedule A of the WWDI
-----------
Disclosure Schedule consists of a true and complete list of all material
--------------------
contracts, agreements, commitments and other instruments (whether oral or
written) to which WWDI is a party. WWDI has made or will make available to GRC a
copy of each such contract. All such contracts are valid and binding upon WWDI
and are in full force and effect and are enforceable in accordance with their
respective terms. To WWDI's knowledge, no such contracts are in breach, and no
event has occurred which, with the lapse of time or action by a third party,
could result in a material default under the terms thereof. To its knowledge, no
stockholder of WWDI has received any payment from any contracting party in
connection with or as an inducement for causing WWDI to enter into any such
contract.
4.17 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as set forth in the
WWDI Disclosure Schedule, since December 31, 2000 (the "Balance Sheet Dates"),
-------------------
there has not been:
(a) any material adverse change in the financial condition,
properties, assets, liabilities or business of WWDI;
(b) any material damage, destruction or loss of any material
properties of WWDI, whether or not covered by insurance;
(c) any material adverse change in the manner in which the
business of WWDI and has been conducted;
(d) any material adverse change in the treatment and protection of
trade secrets or other confidential information of WWDI; and
(e) any occurrence not included in paragraphs (a) through (d) of
this Section 3.14 which has resulted, or which WWDI has reason to believe, might
be expected to result in a material adverse change in the business or prospects
of WWDI.
4.18 FINANCIAL STATEMENTS. The WWDI Disclosure Schedule contains an
-------------------
audited balance sheet of WWDI as of December 31, 2000 and related audited
statements of operations, cash flows and stockholders' equity of WWDI for the
required periods ended at such date (collectively the "WWDI Financial
Statements"). The WWDI Financial Statements present fairly, in all material
respects, the financial position on the dates thereof and results of operations
of WWDI for the periods indicated, prepared in accordance with GAAP,
consistently applied. There are no assets of WWDI the value of which is
materially overstated in said balance sheets.
4.19 NO BREACHES. The making and performance of this Agreement will
not (i) conflict with or violate the Articles of Incorporation or the Bylaws of
WWDI, (ii) violate any laws, ordinances, rules, or regulations, or any order,
writ, injunction or decree to which WWDI is party or by which WWDI or any of
its businesses, or operations may be bound or affected or (iii) result in any
breach or termination of, or constitute a default under, or constitute an event
which, with notice or lapse of time, or both, would become a default under, or
result in the creation of any encumbrance upon any material asset of WWDI under,
or create any rights of termination, cancellation or acceleration in any person
under, any contract to which it is a party.
17
4.20 WWDI INTELLECTUAL PROPERTY. Schedule B of the WWDI Disclosure
----------- ----------
Schedule sets forth a complete and correct list and summary description of all
--------
intellectual property, including computer software, trademarks, trade names,
service marks, service names, brand names, copyrights and patents, registrations
thereof and applications therefore, applicable to or used in the business of
WWDI, together with a complete list of all licenses granted by or to WWDI with
respect to any of the above. Except as otherwise set forth in Schedule B all
----------
such trademarks, trade names, service marks, service names, brand names,
copyrights and patents are owned by WWDI, free and clear of all liens, claims,
security interests and encumbrances of any nature whatsoever. WWDI is not
currently in receipt of any notice of any violation or infringements of, and is
not knowingly violating or infringing, the rights of others in any trademark,
trade name, service xxxx, copyright, patent, trade secret, know-how or other
intangible asset. WWDI has not (i) licensed any of the material proprietary
assets to any person or entity on an exclusive basis, or (ii) entered into any
covenant not to compete or agreement limiting its ability to exploit fully any
proprietary asset or to transact business in any market or geographical area or
with any person or entity.
4.21 DISCLAIMER OF FURTHER WARRANTIES; ETC. Except as expressly set
forth in this Agreement and any Schedules and Exhibits hereto, GRC has not made
any other representation or warranty to Seller or WWDI in connection with the
Exchange. Seller's decision to enter into the Exchange is based upon its own
independent judgment and investigation and not on any representations and
warranties of GRC other than those expressly stated in this Agreement and in the
Schedules and Exhibits hereto.
V
CLOSING
5.1 CLOSING. The Exchange shall be completed on the first business
day after the day on which the last of the conditions contained in this Article
V is fulfilled or waived (the "Closing Date"); provided, however, that in no
event shall the Closing occur later than May 31, 2001, unless otherwise agreed
to by the parties. The Closing shall take place at the offices of Silicon Valley
Law Group at 000 X. Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx, Xxxxxxxxxx 00000. At the
Closing, GRC, Seller and WWDI shall make the deliveries contemplated by this
Agreement, and in accordance with the terms of this Agreement.
5.2 GRC'S CLOSING DELIVERIES. At the Closing, in addition to documents
referred elsewhere, GRC shall deliver, or cause to be delivered, to Seller and
WWDI:
(a) a certificate, dated as of the Closing Date, executed by the
President or Chief Executive Officer of GRC, to the effect that the
representations and warranties contained in this Agreement are true and correct
in all material respects at and as of the Closing Date and that GRC has complied
with or performed in all material respects all terms, covenants and conditions
to be complied with or performed by GRC on or prior to the Closing Date;
(b) certificates representing the GRC Stock issuable upon
consummation of the Exchange;
18
(c) Certified resolution of the Board of Directors authorizing and
approving the transactions set forth herein;
(d) The GRC Disclosure Schedule;
--------------------
(e) Warrants issued in accordance with the terms set forth in
Schedule 1.4(e), hereof;
----------------
(f) The corporate seal, original minute book and all blank stock
certificates of GRC, together with all other books and records of GRC;
(g) such other documents as Seller, WWDI, or their counsel may
reasonably require.
5.3 WWDI'S CLOSING DELIVERIES. At the Closing, in addition to documents
referred to elsewhere, Seller and/or WWDI shall deliver to GRC:
(a) a certificate of WWDI, dated as of the Closing Date, executed
by the President or Chief Executive Officer of WWDI to the effect that the
representations and warranties of Seller contained in this Agreement are true
and correct in all material respects and that WWDI has complied with or
performed in all material respects all terms, covenants, and conditions to be
complied with or performed by WWDI or prior to the Closing Date;
(b) certificates representing WWDI Stock owned by Seller, duly
endorsed for transfer or accompanied by a properly executed stock power;
(c) Certified resolution of the respective Boards of Directors of
Seller and WWDI, authorizing and approving the transactions set forth herein;
(d) the Seller and WWDI Disclosure Schedule; and
--------------------
(e) such other documents as GRC or it's counsel may reasonably
require.
5.4 SEC FILINGS. Seller is a company reporting under the Securities
and Exchange Act of 1934 and a copy of its most recent 10K (the "SEC Filings")
has been delivered to GRC.
(a) As promptly as practicable after the date of this Agreement,
WWDI shall prepare and cause to be filed with the SEC a registration statement
on Form SB-2 or other appropriate form, registering the shares of capital stock
of investors and certain management personnel of the seller receiving shares of
capital stock, and shares of common stock underlying warrants issued to
financial and other consultants and said management personnel of the Seller, in
connection with the Exchange.
19
VI
CONDITIONS TO OBLIGATIONS OF GRC
The obligation of GRC to consummate the Closing is subject to the following
conditions, any of which may be waived by it in its sole discretion.
6.1 COMPLIANCE BY SELLER AND WWDI. Seller and WWDI shall have
performed and complied in all material respects with all agreements and
conditions required by this Agreement to be performed or complied with by Seller
and WWDI prior to or on the Closing Date;
6.2 ACCURACY OF SELLER AND WWDI'S REPRESENTATIONS. Seller and WWDI's
representations and warranties contained in this Agreement (including the
Disclosure Schedule) or any schedule, certificate, or other instrument delivered
--------------------
pursuant to the provisions hereof or in connection with the transactions
contemplated hereby shall be true and correct in all material respects at and as
of the Closing Date (except for such changes permitted by this Agreement) and
shall be deemed to be made again as of the Closing Date.
6.3 DOCUMENTS. All documents and instruments required hereunder to be
delivered by Seller or WWDI to GRC at the Closing shall be delivered in form and
substance reasonably satisfactory to GRC and its counsel.
6.4 LITIGATION. No litigation seeking to enjoin the transactions
contemplated by this Agreement or to obtain damages on account hereof shall be
pending or be threatened.
6.5 MATERIAL ADVERSE CHANGE. No material adverse change shall have
occurred subsequent to December 31, 2000 in the financial position, results of
operations, assets, liabilities or prospects of Seller and WWDI, nor shall any
event or circumstance have occurred which would result in a material adverse
change in the financial position, results of operations, assets, liabilities or
prospects of Seller or WWDI.
VII
CONDITIONS TO SELLER AND WWDI'S OBLIGATIONS
Seller and WWDI's obligation to consummate the Closing is subject to the
following conditions, any of which may be waived by either party in its sole
discretion:
7.1 COMPLIANCE BY GRC. GRC shall have performed and complied in all
material respects with all agreements and conditions required by this Agreement
to be performed or complied with by GRC prior to or on the Closing Date.
7.2 ACCURACY OF REPRESENTATIONS OF GRC. The representations and
warranties of GRC contained in this Agreement (including the exhibits hereto and
the GRC Disclosure Schedule) or any schedule, certificate, or other instrument
-------------------
delivered pursuant to the provisions hereof or in connection with the
transactions contemplated hereby shall be true and correct in all material
respects at and as of the Closing Date (except for changes permitted by this
Agreement) and shall be deemed to be made again as of the Closing Date.
20
7.3 MATERIAL ADVERSE CHANGE. No material adverse change shall have
occurred subsequent to December 31, 2000 in the financial position, results of
operations, assets, liabilities, or prospects of GRC, nor shall any event or
circumstance have occurred which would result in a material adverse change in
the financial position, results of operations, assets, liabilities, or prospects
of GRC.
7.4 LITIGATION. No litigation seeking to enjoin the transactions
contemplated by this Agreement or to obtain damages on account hereof shall be
pending or to Seller and WWDI's knowledge be threatened.
7.5 DOCUMENTS. All documents and instruments required hereunder to be
delivered by GRC to Seller and WWDI at the Closing shall be delivered in form
and substance reasonably satisfactory to Seller, WWDI and their counsel.
7.6 BALANCE SHEET. GRC shall have no liabilities except as incurred in
the ordinary course of business, as reflected on GRC's most recent balance
sheet, or as otherwise approved by Seller.
VIII
TERMINATION
8.1 TERMINATION PRIOR TO CLOSING.
(a) If the Closing has not occurred by May 31, 2001, any party may
terminate this Agreement at any time thereafter by giving written notice of
termination to the other, provided, however, that no party may terminate this
Agreement if such party has breached any material terms or conditions of this
Agreement and such breach has prevented the timely closing of the Exchange.
Notwithstanding the above, such deadline may be extended one or more times, only
by mutual written consent of Seller, WWDI and GRC;
(b) Prior to May 31, 2001, any party may terminate this Agreement
following the insolvency or bankruptcy of the other party hereto, or if any one
or more of the conditions to Closing set forth in Article VI or Article VII
shall become incapable of fulfillment or there shall have occurred a material
breach of this Agreement and either such condition of breach shall not have been
waived by the party for whose benefit the condition was established, then GRC
(in the case of a condition in Article V1) or Seller (in the case of a condition
specified in Article VII) may terminate this Agreement. In addition, either GRC
or Seller may terminate this Agreement upon written notice to the other if it
shall reasonably determine that the Exchange has become inadvisable by reason of
the institution or threat by any federal, state or municipal governmental
authorities of a formal investigation or of any action, suit or proceeding of
any kind against either or both parties.
8.2 CONSEQUENCES OF TERMINATION. Upon termination of this Agreement
pursuant to this Article VIII or any other express right of termination provided
elsewhere in this Agreement, the parties shall be relieved of any further
obligation under this Agreement except for GRC's obligations in Section 12.4;
provided, however, that no termination of this Agreement, pursuant to this
Article VIII hereof or under any other express right of termination provided
21
elsewhere in this Agreement shall operate to release any party from any
liability to any other party incurred otherwise than under this Agreement before
the date of such termination, or from any liability resulting from any willful
misrepresentation of a material fact made in connection with this Agreement or
willful breach of any material provision hereof.
IX
ADDITIONAL COVENANTS
9.1 MUTUAL COOPERATION. The parties hereto will cooperate with each
other, and will use all reasonable efforts to cause the fulfillment of the
conditions to the parties' obligations hereunder and to obtain as promptly as
possible all consents, authorizations, orders or approvals from each and every
third party, whether private or governmental, required in connection with the
transactions contemplated by this Agreement.
9.2 CHANGES IN REPRESENTATIONS AND WARRANTIES OF A PARTY. Between the
date of this Agreement and the Closing Date, no party shall directly or
indirectly, enter into any transaction, take any action, or by inaction permit
an otherwise preventable event to occur, which would result in any of the
representations and warranties of such party herein contained not being true and
correct at and as of the Closing Date. Each party shall promptly give written
notice to the other parties upon becoming aware of (A) any fact which, if known
on the date hereof, would have been required to be set forth or disclosed
pursuant to this Agreement, and (B) any impending or threatened breach in any
material respect of any of the party's representations and warranties contained
in this Agreement and with respect to the latter shall use all reasonable
efforts to remedy same.
9.3 NAME CHANGE. As soon as practicable after the Closing, GRC shall
change its name to "Wireless Web Data, Inc." or other similar name approved by
Seller.
9.4 SEC FILINGS. The parties agree that the following filings shall be
made with the Securities and Exchange Commission ("Commission"): (a) an
information statement prepared pursuant to the requirements of Rule 14f-1 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act') shall be
filed with the Commission and shall be mailed to GRC's shareholders of record at
least ten (10) calendar days prior to the Closing; (b) within fifteen (15) days
following the Closing, a report on Form 8-K will be filed with the Commission
disclosing the consummation of the Exchange; (c) ImaginOn shall file a Schedule
13D and report of beneficial ownership on Form 3 with the Commission after the
Closing within the required time frames; and (d) the officers and directors of
GRC following the Closing shall file with the Commission reports on Form 3
within the required time.
X
FINANCIAL CONSULTANTS
10.1 CONSULTANTS. Except for World Capital Funding, LLC and Gulfstream
Financial Partners LLP, each party represents to the others that there is no
broker or finder entitled to a fee or other compensation for bringing the
parties together to effect the Exchange.
22
XI
SECURITIES
11.1 NEW SHARES NOT REGISTERED. The New Shares when issued will not
be registered under the Act or applicable state laws, but shall be issued in
reliance upon the exemptions from registration provided by Section 4(2) of the
Act and/or Rule 505 of Regulation D under the Act and under analogous state
securities laws, on the grounds that the Exchange does not involve any public
offering. The New Shares will be "restricted securities" as that term is defined
in Rule 144(a) of the General Rules and Regulations under the Act and must be
held indefinitely, unless they are subsequently registered under the Act or an
exemption from the Act's registration requirements is available for their
resale. The prior written consent of the Company will be necessary for any
transfer of any or all of the New Shares, unless the shares have been duly
registered under the Act or the transfer is made in accordance with Rule 144 or
other available exemption under the Act. All certificates evidencing the New
Shares shall, unless and until removed in accordance with law, bear a
restrictive legend substantially in the following form:
"The shares represented by this Certificate have not been registered
under the Securities Act of 1933, as amended (the "Act"), and are "restricted
securities" as that term is defined in Rule 144 under the Act. These shares
may not be offered for sale, sold or otherwise transferred except pursuant to
an effective registration statement under the Act, or pursuant to an
exemption from registration under the Act."
11.2 INDEMNIFICATION BY GRC. GRC shall indemnify Seller and WWDI in
respect of, and hold Seller and WWDI harmless against, any and all debts,
obligations and other liabilities (whether absolute, accrued, contingent, fixed
or otherwise, or whether known or unknown, or due or to become due or
otherwise), monetary damages, fines fees, penalties, interest obligations,
deficiencies, losses and expenses (including without limitation attorneys fees
and litigation costs) incurred or suffered by Seller and WWDI:
(a) resulting from any misrepresentation, breach of warranty or
failure to perform any covenant or agreement of GRC contained in this Agreement;
(b) resulting from any employment, excess or property taxes owing
or arising on account of or in connection with the operation of GRC prior to the
Closing; and
(c) resulting from any liability of GRC incurred or resulting from
activities that took place prior to the Closing not disclosed on the December
31, 2000 Balance Sheet and not incurred in the ordinary course of business
between December 31, 2000 and the Closing.
11.3 INDEMNIFICATION BY SELLER AND WWDI. Seller and WWDI shall
indemnify GRC in respect of, and hold GRC harmless against, any and all debts,
obligations and other liabilities (whether absolute, accrued, contingent, fixed
or otherwise, or whether known or unknown, or due or to become due or
otherwise), monetary damages, fines fees, penalties, interest obligations,
deficiencies, losses and expenses (including without limitation attorneys fees
and litigation costs) incurred or suffered by GRC:
23
(a) resulting from any misrepresentation, breach of warranty or
failure to perform any covenant or agreement of Seller or WWDI contained in this
Agreement;
(b) resulting from any employment, excess or property taxes owing
or arising on account of or in connection with the operation of Seller or WWDI
prior to the Closing; and
(c) resulting from any liability of Seller or WWDI incurred or
resulting from activities that took place prior to the Closing not disclosed on
the December 31, 2000 Balance Sheet and not incurred in the ordinary course of
business between December 31, 2000 and the Closing.
XII
MISCELLANEOUS
12.1 EXPENSES. Each party shall each pay its own expenses incident to
the negotiation, preparation, and carrying out of this Agreement, including
legal and accounting and audit fees.
12.2 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. All
statements contained in this Agreement or in any certificate delivered by or on
behalf of GRC or Seller or WWDI pursuant hereto, or in connection with the
actions contemplated hereby shall be deemed representations, warranties and
covenants by Seller, WWDI, GRC, as the case may be, hereunder. All
representations, warranties, and covenants made by GRC, Seller or WWDI in this
Agreement, or pursuant hereto, shall survive the Closing.
12.3 PUBLICITY. Seller, WWDI, GRC shall not issue any press release or
make any other public statement, in each case, relating to, in connection with
or arising out of this Agreement or the transactions contemplated hereby,
without obtaining the prior approval of the other, which shall not be
unreasonably withheld or delayed, except that prior approval shall not be
required if, in the reasonable judgment of Seller or WWDI prior approval by GRC
would prevent the timely dissemination of such release or statement in violation
of applicable Federal securities laws, rules or regulations or policies of the
OTC Bulletin Board.
12.4 NON DISCLOSURE. GRC will not at any time after the date of this
Agreement, without Seller and WWDI's consent, except in the ordinary operation
of its business or as required by law, divulge, furnish to or make accessible to
anyone any knowledge or information with respect to confidential or secret
processes, inventions, discoveries, improvements, formulae, plans, material,
devices or ideas or know-how, whether patentable or not, with respect to any
confidential or secret aspects of GRC (including, without limitation, customer
lists, supplier lists and pricing arrangements with customers or suppliers)
("Confidential Information"). Seller and WWDI will not at any time after the
date of this Agreement and prior to the Exchange use, divulge, furnish to or
make accessible to anyone any Confidential Information (other than to its
representatives as part of its due diligence or corporate investigation). Any
information, which (i) at or prior to the time of disclosure by either GRC,
Seller or WWDI was generally available to the public through no breach of this
covenant, (ii) was available to the public on a nonconfidential basis prior to
its disclosure by either GRC, Seller or WWDI, or (iii) was made available to the
public from a third party provided that such third party did not obtain or
24
disseminate such information in breach of any legal obligation of GRC, Seller or
WWDI, shall not be deemed Confidential Information for purposes hereof, and the
undertakings in this covenant with respect to Confidential Information shall not
apply thereto. The undertakings of GRC, Seller and WWDI set forth above in this
Section 12.4 shall terminate upon consummation of the Closing. If this Agreement
is terminated pursuant to the provisions of Article VIII or any other express
right of termination set forth in this Agreement, Seller and WWDI shall return
to GRC all copies of all Confidential Information previously furnished to it by
GRC.
12.5 SUCCESSION AND ASSIGNMENTS AND THIRD PARTY BENEFICIARIES. This
Agreement may not be assigned (either voluntarily or involuntarily) by any party
hereto without the express written consent of the other parties. Any attempted
assignment in violation of this Section shall be void and ineffective for all
purposes. In the event of an assignment permitted by this Section, this
Agreement shall be binding upon the heirs, successors and assigns of the parties
hereto. There shall be no third party beneficiaries of this Agreement except as
expressly set forth herein to the contrary.
12.6 NOTICES. All notices, requests, demands, or other communications
with respect to this Agreement shall be in writing and shall be (i) sent by
facsimile transmission, (ii) sent by the United States Postal Service,
registered or certified mail, return receipt requested, or (iii) personally
delivered by a nationally recognized express overnight courier service, charges
prepaid, to the following addresses (or such other addresses as the parties may
specify from time to time in accordance with this Section)
(a) TO SELLER:
ImaginOn, Inc. WITH A COPY TO:
0000 Xxxxxx Xxxxxx, Xxxxx 0
Xxx Xxxxxx, Xxxxxxxxxx 00000 Silicon Valley Law Group
ATTN: Xxxxx X. Xxxxxxx
Phone No. 000-000-0000 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Fax No. 000-000-0000 Xxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxxxxx
(b) TO WWDI:
Wireless Web Data, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx 0
Xxx Xxxxxx, Xxxxxxxxxx 00000
Phone No.
Fax No.
Attn: Xxxxx Xxxxxxx
WITH A COPY TO:
Silicon Valley Law Group
ATTN: Xxxxx X. Xxxxxxx
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, Xxxxxxxxxx 00000
25
(c) TO GRC:
Xxxxxxxxx Research Corporation WITH A COPY TO:
00000 Xxxx Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000 Xxxx X. Xxxxxxx Xx.
Xxxxxxx & Company
00 Xxxxxxx Xxxxxx, Xxxxx 000
Phone No. (000) 000-0000 Xxxxxx, Xxxxxxxx 00000
Fax No. (000) 000-0000 TEL 000.000.0000
Attn: Xxxxxxx X. Xxxxxx FAX 303.355-3063
Any such notice shall, when sent in accordance with the preceding sentence,
be deemed to have been given and received on the earliest of (i) the day
delivered to such address or sent by facsimile transmission, (ii) the fifth
business day following the date deposited with the United States Postal Service,
or (iii) 24 hours after shipment by such courier service.
12.7 CONSTRUCTION. This Agreement shall be construed and enforced in
accordance with the internal laws of the State of Delaware without giving effect
to the principles of conflicts of law thereof.
12.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which shall
together constitute one and the same Agreement.
12.9 NO IMPLIED WAIVER; REMEDIES. No failure or delay on the part of
the parties hereto to exercise any right, power, or privilege hereunder or under
any instrument executed pursuant hereto shall operate as a waiver nor shall any
single or partial exercise of any right, power, or privilege preclude any other
or further exercise thereof or the exercise of any other right, power, or
privilege. All rights, powers, and privileges granted herein shall be in
addition to other rights and remedies to which the parties may be entitled at
law or in equity.
12.10 ENTIRE AGREEMENT. This Agreement, including the Exhibits and
Disclosure Schedules attached hereto, sets forth the entire understandings of
---------------------
the parties with respect to the subject matter hereof, and it incorporates and
merges any and all previous communications, understandings, oral or written as
to the subject matter hereof, and cannot be amended or changed except in
writing, signed by the parties.
12.11 HEADINGS. The headings of the Sections of this Agreement, where
employed, are for the convenience of reference only and do not form a part
hereof and in no way modify, interpret or construe the meanings of the parties.
12.12 SEVERABILITY. To the extent that any provision of this Agreement
shall be invalid or unenforceable, it shall be considered deleted hereof and the
remainder of such provision and of this Agreement shall be unaffected and shall
continue in full force and effect.
26
12.13 ATTORNEYS FEES. In the event any legal action is brought to
interpret or enforce this Agreement, the party prevailing in such action shall
be entitled to recover its attorneys' fees and costs in addition to any other
relief that it is entitled.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
XXXXXXXXX RESEARCH CORPORATION IMAGINON, INC.
By./s/ Xxxxxxx X. Xxxxxx By:/s/ Xxxxx Xxxxxxxx
---------------------------- --------------------------
Name: Xxxxxxx X. Xxxxxx Name: Xxxxx Xxxxxxxx
Title: President Its: President
WIRELESS WEB DATA, INC.
By. /s/ Xxxxx Xxxxxxx
----------------------------
Name: Xxxxx Xxxxxxx
Its: President
