AGREEMENT
THIS AGREEMENT (the "Agreement") is made this 6th day of January,
2000, among O. T. S. Holdings, Inc., a Colorado corporation ("OTS"); Xxxxxx
Xxxxxx, its sole director and executive officer and a director of Wire To
Wire, Inc. ("Xxxxxx"); Wire To Wire, Inc., dba WWW Consulting, a Nevada
corporation and a creditor of OTS ("WWW"); Xxxxx X. Xxxxxx, the wife of Xxxxxx
and a director of WWW ("X. Xxxxxx"); and Xxxx Xxxxxxxxxx, an individual
("Xxxxxxxxxx").
W I T N E S S E T H:
RECITALS
WHEREAS, OTS has numerous liabilities which Xxxxxx believe cannot
be satisfactorily compromised or settled while he is affiliated with OTS; and
WHEREAS, Xxxxxxxxxx has expertise in reorganizing public companies
and is willing to use his "best efforts" to compromise and settle the
outstanding debts and liabilities of OTS and to pay certain funds as outlined
herein in consideration of the issuance of fully paid common stock
("restricted securities") of OTS and his designation or election to the Board
of Directors of OTC; and
WHEREAS, Xxxxxx, WWW and/or X. Xxxxxx have, as a condition to
Xxxxxxxxxx executing and delivering this Agreement, agreed to execute and
deliver this Agreement and to be personally bound by the terms and conditions
hereof, without qualification; and
WHEREAS, the parties hereto believe this Agreement is in the best
interest of OTS and the OTS stockholders;
NOW, THEREFORE, in consideration of the mutual covenants and
promises contained herein, it is agreed:
Section 1
Reorganization
1.1 Engagement of Xxxxxxxxxx. OTS hereby engages
Xxxxxxxxxx to use his "best efforts" to compromise and settle the outstanding
debts and liabilities of OTS in consideration of the issuance of 10,000,000
shares of OTS no par value common stock ("restricted securities"), which shares
shall be fully paid and non-assessable on issuance.
1.2 Designation of Xxxxxxxxxx as a Director. Xxxxxx hereby
designates Xxxxxxxxxx as a director of OTS, and to the extent required or
necessary, adopts such resolutions as may be required or necessary to amend
the Bylaws of OTS to allow such designation.
1.3 Resignation of Xxxxxx as a Director. Xxxxxx hereby
resigns as a director and executive officer of OTS, effective on the execution
and delivery of this Agreement by all of the parties hereto.
1.4 Cancellation of Certain Debt of WWW, Xxxxxx and X.
Xxxxxx. As further consideration of the issuance of the 10,000,000 shares of OTS
common stock to Xxxxxxxxxx as outlined in Section 1.1, Xxxxxxxxxx shall pay
WWW the sum of $25,000, and:
(i) WWW, shall compromise and settle all claims for
compensation from OTS under that certain
Management Agreement dated January 1, 1996 (the
"Management Agreement"), a copy of which is
attached hereto, designated as Exhibit A, and
incorporated herein by reference, for the years
1998, 1999 and 2000; shall accept 1,200,000 shares
of OTS common stock ("restricted securities") in
consideration of all amount due to it under the
Management Agreement for 1996 and 1997; hereby
otherwise compromises and settles any and all
other claims of any type or nature whatsoever that
it has or may have against OTS; hereby covenants
not to xxx OTS, its directors, executive
officers, agents or attorneys, for any reason
whatsoever existing prior to the execution and
delivery of this Agreement.
(ii) In consideration of the conveyance by OTS to
Xxxxxx and X. Xxxxxx of all right, title and
interest of OTS in any other corporation owned by
OTS, including, but not limited to Sugar Creek
Coffee, Xxxxx Engineered Construction Components,
Inc. and CEC Industries Corp., Xxxxxx and X.
Xxxxxx hereby compromise and settle any and all
claims of any type or nature whatsoever that
either has or may have against OTS;
and each hereby covenants not to xxx OTS, its
directors, executive officers, agents or
attorneys, for any reason whatsoever existing
prior to the execution and delivery of this
Agreement.
1.5 Further Assurances. At the closing (the "Closing") and
from time to time thereafter, the parties shall execute such additional
instruments as may be reasonably required or necessary to complete the matters
outlined in Section 1 hereof.
1.6 Assets and Liabilities of OTS at Closing. OTS shall
have no material assets and the only liabilities of OTS are those outlined in
the prior Bankruptcy Petition of OTS dated April 23, 1997, a copy of which is
attached hereto, designated as Exhibit B, and incorporated herein by reference
Section 2
Closing
The Closing contemplated by Section 1 shall be held at the offices
of Xxxxxxx X. Xxxxxxxxxx, Esq., Suite 205 Hermes Building, 000 Xxxx 000 Xxxxx,
Xxxx Xxxx Xxxx, Xxxx 00000, on the execution and delivery of this Agreement,
unless another place or time is agreed upon in writing by the parties. The
Closing may be accomplished by facsimile, wire, express mail or other courier
service, conference telephone communications or as otherwise agreed by the
respective parties or their duly authorized representatives.
Section 3
Representations and Warranties of OTS, Xxxxxx, WWW and X. Xxxxxx
OTS, Xxxxxx, WWW and X. Xxxxxx represent and warrant to, and
covenants with, Xxxxxxxxxx as follows:
3.1 Corporate Status. OTS is a corporation duly organized,
validly existing and in good standing under the laws of the State of Colorado
and is licensed or qualified as a foreign corporation in all states in which
the nature of its business or the character or ownership of its properties
makes such licensing or qualification necessary (Colorado only). OTS is a
publicly held company, having previously and lawfully offered and sold a
portion of its securities in accordance with applicable federal and state
securities laws, rules and regulations. However, there is presently only a
nominal "public market" for the shares of common stock of OTS.
3.2 Capitalization. The current pre-Agreement authorized
capital stock of OTS consists of 100,000,000 shares of no par value common
voting stock, of which approximately 7,249,682 shares are issued and
outstanding, all fully paid and non-assessable; and 10,000,000 shares of
preferred stock, par value $0.10 per share, of which approximately 353,000
shares may still be issued or outstanding. Except for the 1,200,000 shares
to be issued to WWW as outlined in Section 1.4(i), there are no outstanding
options, warrants, calls or other rights of any type or nature whatsoever
pursuant to which any person has the right to purchase any authorized and
unissued common or preferred stock of OTS; and with respect to the 1,200,000
shares to be issued, such shares shall be "restricted securities," and be
represented by a stock certificate imprinted with a "restrictive" legend
indicating that such share cannot be sold unless the sale thereof is
registered with the Securities and Exchange Commission or exempt for the
registration requirements of Section 5 of the Securities Act of 1933, as
amended.
3.3 Undisclosed Liabilities. OTS has no liabilities of any
nature, whether accrued, absolute, contingent or otherwise, including, without
limitation, tax liabilities and interest due or to become due, except as
listed in Exhibit B.
3.4 Title to Property. OTS has good and marketable title
to all properties and assets, real and personal, and the properties and assets
of OTS are subject to no mortgage, pledge, lien or encumbrance, with respect to
which no default exists, except as indicated in Exhibit B.
3.5 Litigation. Except as listed in Exhibit B, there is no
litigation or proceeding pending, or to the knowledge of OTS, threatened,
against or relating to OTS, its properties or business. Further, no officer,
director or person who may be deemed to be an "affiliate" of OTS is party to
any material legal proceeding which could have an adverse effect on OTS
(financial or otherwise), and none is party to any action or proceeding
wherein any has an interest adverse to OTS.
3.6 Books and Records. On Closing, OTS will promptly
deliver to Xxxxxxxxxx all books and records of any type of nature whatsoever.
3.7 Tax Returns. OTS has not filed all federal and state
income or franchise tax returns required to be filed, but except as indicated in
Exhibit B, there are no taxes due.
3.8 Corporate Authority. OTS has full corporate power and
authority to enter into this Agreement and to carry out its obligations
hereunder and will deliver to Xxxxxxxxxx at the Closing a certified copy of
resolutions of its Board of Directors authorizing execution of this Agreement
by OTS's sole officer and performance thereunder, and that the sole director,
Xxxxxx, adopting and delivering such resolutions is the only duly elected and
incumbent director of OTS.
3.9 Due Authorization. Execution of this Agreement and
performance by OTS hereunder have been duly authorized by all requisite
corporate action on the part of OTS, and this Agreement constitutes a valid
and binding obligation of OTS and performance hereunder will not violate any
provision of the Articles of Incorporation, Bylaws, agreements, mortgages or
other commitments of OTS.
3.13 Environmental Matters. OTS has no knowledge of any
assertion by any governmental agency or other regulatory authority of any
environmental lien, action or proceeding, or of any cause for any such lien,
action or proceeding related to the business operations of OTS or OTS'
predecessors. In addition, to the best knowledge of OTS, there are no
substances or conditions which may support a claim or cause of action against
OTS or any of OTS' current or former officers, directors, agents or employees,
whether by a governmental agency or body, private party or individual, under
any Hazardous Materials Regulations. "Hazardous Materials" means any oil or
petrochemical products, PCB's, asbestos, urea formaldehyde, flammable
explosives, radioactive materials, solid or hazardous wastes, chemicals, toxic
substances or related materials, including, without limitation, any substances
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," or "toxic substances" under any applicable
federal or state laws or regulations. "Hazardous Materials Regulations" means
any regulations governing the use, generation, handling, storage, treatment,
disposal or release of hazardous materials, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, the
Resource Conservation and Recovery Act and the Federal Water Pollution Control
Act.
3.14 Access to Information and Sophistication. Xxxxxx, X.
Xxxxxx and WWW are "sophisticated persons," who by reason of experience,
business acumen, education or other factors, are fully capable of evaluating
this Agreement and all consequences which may arise thereunder, without
qualification.
Section 4
Representations, Warranties and Covenants of Xxxxxxxxxx
Xxxxxxxxxx represents and warrants to, and covenant with, OTS,
Xxxxxx, WWW and X. Xxxxxx as follows:
4.1 Expertise. He has approximately 10 years of experience
in reorganizing publicly-held companies.
4.2 "Best Efforts". He will use his best efforts to
compromise and settle the outstanding debts and liabilities of OTS, obtain the
required financial statements to provide for public quotations of the OTS common
stock and to find an acquisition, merger or reorganization candidate for OTS
which desires to go public through a "reverse" reorganization or merger
transaction with OTS.
4.3 Investment Intent. Xxxxxxxxxx is acquiring the shares
of OTS to be issued to him hereunder for investment purposes, and understands
that any stock certificate issued to him and representing these shares shall
be imprinted with an appropriate "restrictive" legend.
4.4 Due Authorization. Xxxxxxxxxx has full right, power
and authority to enter into this Agreement, without qualification.
Section 5
Conditions Precedent to Obligations of Xxxxxxxxxx
All obligations of Xxxxxxxxxx under this Agreement are subject,
at his option, to the fulfillment, before or at the Closing, of each of the
following conditions:
5.1 Representations and Warranties True at Closing. The
representations and warranties of OTS, Xxxxxx, WWW and X. Xxxxxx contained in
this Agreement shall be deemed to have been made again at and as of the
Closing and shall then be true in all material respects and shall survive the
Closing.
5.2 Due Performance. OTS, Xxxxxx, WWW and X. Xxxxxx shall
have performed and complied with all of the terms and conditions required by
this Agreement to be performed or complied with by it before the Closing.
5.3 Director's Consent. OTS and Xxxxxx shall have adopted
the necessary resolutions to adopt, ratify and approve all transactions
contemplated hereby.
5.4 Assets and Liabilities of OTS. Unless otherwise
agreed, OTS shall have no assets and no liabilities at Closing, except as
indicated in Exhibit B.
5.5 Resignation of Director and Executive Officer and
Designation of Xxxxxxxxxx to the Board of Directors of OTS. The present sole
director and executive officer of OTS shall have designated Xxxxxxxxxx as a
director of OTS, to serve until the next annual meeting of the stockholders of
OTS, and until his successor shall be elected and qualified or until his
prior resignation or termination; and then, such sole director and executive
officer shall resign.
Section 6
General Provisions
6.1 Further Assurances. At any time, and from time to
time, after the Closing, each party will execute such additional instruments and
take such action as may be reasonably requested by the other party to confirm
or perfect title to any property transferred hereunder or otherwise to carry
out the intent and purposes of this Agreement.
6.2 Brokers. Each party represents to the other parties
hereunder that no broker or finder has acted for it in connection with this
Agreement, and agrees to indemnify and hold harmless the other parties against
any fee, loss or expense arising out of claims by brokers or finders employed
or alleged to have been employed by each.
6.3 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been given if
delivered in person or sent by prepaid first-class registered or certified
mail, return receipt requested, as follows:
If to Xxxxxxxxxx 0000 Xxxx Xxxxxxxx Xxxxx
Xxxx Xxxx Xxxx, Xxxx 00000
With a copy to: Xxxxxxx X. Xxxxxxxxxx, Esq.
455 East 000 Xxxxx, #000
Xxxx Xxxx Xxxx, Xxxx 00000
If to Xxxxxx, WWW
X. Xxxxxx: 0000 Xxxx Xxxxxxx Xxxx, Xxxxx X
Xxx Xxxxx, Xxxxxx 00000
6.5 Entire Agreement. This Agreement constitutes the
entire agreement between the parties and supersedes and cancels any other
agreement, representation or communication, whether oral or written, between the
parties hereto relating to the transactions contemplated herein or the subject
matter hereof.
6.6 Headings. The section and subsection headings in this
Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of this Agreement.
6.7 Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Colorado
with respect to corporate matters only, but any action to enforce any of the
terms and provisions hereof shall be brought in the federal or state courts
situated in Salt Lake County, Utah, only!
6.8 Assignment. This Agreement shall inure to the benefit
of, and be binding upon, the parties hereto and their successors and assigns.
6.9 Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
6.10 Default. In the event of any default hereunder, the
prevailing party in any action to enforce the terms and provisions hereof
shall be entitled to recover reasonable attorney's fees and related costs.
IN WITNESS WHEREOF, the parties have executed this
Agreement effective the day and year first above written.
O. T. S. Holdings, Inc.
Date: 1/6/2000. By/s/Xxxxxx Xxxxxx
Xxxxxx Xxxxxx, President
WIRE To WIRE Incorporated
Date: 1/6/2000. By/s/Xxxxxx Xxxxxx
Xxxxxx Xxxxxx, President
Date: 1/6/2000. /s/Xxxxxx Xxxxxx
Xxxxxx Xxxxxx
Date: 1/6/2000. /s/Xxxxx X Xxxxxx
X. Xxxxxx
Date: 1/6/2000. /s/Xxxx Xxxxxxxxxx
Xxxx Xxxxxxxxxx
