1
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement is entered into this 23 day of September, 1996, by
and between Applied Cellular Technology, Inc., a Missouri
Corporation ("Buyer"), and the individual selling stockholders of
Cra-Tek Company, a California Corporation ("Aquirees") here to
for referred to as ("Shareholders") collectively. Mr. Xxxxx
Xxxxxx & Xx. Xxxx Xxxxx are also sometimes referred to as
("Principals").
Whereas, Shareholders of the $.001 par value issued and
outstanding common stock of the Acquiree ("Acquiree Shares").
Shareholders desire to sell and Buyer desire to purchase at least
80% of the Acquiree shares ("Sale Shares") from the Shareholders
at this time.
Now, Therefore, for the mutual consideration set out herein, the
parties agree as follows:
1. Purchase and Sale of Acquiree Shares.
1.1 Shareholders shall sell to Buyer and Buyer shall
purchase from Shareholder the Sale Shares at a closing of such
sale (the "Closing") to be held at the place and on the date
hereinafter provided (the "Closing Date"). The number of sale
shares of each seller is set forth on Exhibit "A".
1.2 The purchase price (the "Price") for the total sum of
100% of the Shareholders shares shall be $1,750,000 individually
payable in the form of restricted common shares of Buyer with
demand registration rights within one (1) year of the Closing
Date. The number of common shares of Buyer to be issued shall be
based on the bid price of said common shares as listed on NASDAQ
on August 30, 1996, and is set firm at $4.75 and the number of
said shares. However, Buyer must acquire at least 80% of the
Acquiree Shares. The price shall be allocated among the
Shareholders in proportion to their respective shares fully
diluted and outstanding shares of all classes of stock of Cra-Tek
Company, this will effect a "TAX FREE" consolidation.
1.3 At the Closing Date, Shareholders will deliver a
certificate representing the Sale Shares duly endorsed so as to
make Buyer the sole holder thereof, free and clear of all claims
and encumbrances. The Sale Shares are not registered under the
Securities Act of 1933 and amended (the "Act"). The Sale Shares
will be subject to a usual and appropriate stop transfer order on
the books of Acquirees transfer agent pertaining to securities
not registered under the Act. The certificate for the Sale
Shares delivered shall bear on its face the following restrictive
legend:
"No sales, offer to sell or transfer of
the shares represented by this certificate
shall be made unless a registration statement
under the Securities Act of 1933, as amended,
with respect to such shares is then in effect
or an exemption from the registration
requirement of such Act is then in fact
applicable to such shares."
2. Put Option.
The Buyer hereby grants to its remaining Shareholders a put
option to require the Buyer to purchase the remaining issued and
outstanding shares not initially purchased pursuant to this
Agreement. The option shall be exercisable five years from the
Closing Date. The exercise price shall be four times the average
1 of 12
2
earnings before interest, taxes, depreciation & amortization
("EBITDA") of the blended average of the year of put and the
prior year combined. In the determination of the average EBITDA,
no consideration shall be made for any inter-company charges or
management fees, with the exception of reasonable charges for
capital. The purchase price for such additional shares shall be
paid in the same form as described in Section 1.2 with the number
of Buyers shares to be based on the closing bid price of such
shares as of the last business day precluding the day on which
the put is exercised and the additional shares purchased. The
closing of any such acquisition shall occur within ten (10)
business days. The put is exercised and shall occur at the
location described in Section (6).
3. Continuing Management Involvement.
Shareholders and Buyers agree that Xxxxx X. Xxxxxx shall retain
his position for no less than (24) months from the closing date
of this agreement.
4. Representations of Principals hereby represent and warrant,
to the extent of the facts actually known to Principals, that,
effective this date and the Closing Date, the representations
listed below are true and correct to the best of their knowledge.
4.1 Principals and Shareholders are the sole owners of all
the issued and outstanding Shares of Acquiree; all such Acquiree
Shares are free from claims, liens or other encumbrances; and
Principals and Shareholders have the unqualified right to
transfer and dispose of such shares.
4.2 The Sale Shares constitute validly issued shares of
Acquiree fully-paid and nonassessable.
4.3 Annexed hereto as Exhibit 4.3 is the unaudited
financial statements dated June 30, 1996 of the Acquiree. The
financial statements Exhibit 4.3 are substantially correct and
complete and have been prepared in conformity with general
accepted accounting principles applied on a constant basis. The
financial statements present fairly the financial condition of
Acquiree as of the respective dates of said balance sheets and
the results of operations for the respective periods indicated in
said statements of income and retained earnings and, in the case
of each such interim statement, is subject to year-end
adjustments consistent with past practice.
4.4 To the extent of facts actually known by the
Principals, there are no actions, suits, proceedings or
investigations (whether or not purportedly on behalf of Acquiree)
pending or, threatened against or affecting Acquiree, at law, or
in equity or admiralty, or before or by any federal, state,
municipal or other governmental department, commission, board,
bureau agency or instrumentality, domestic or foreign, which
involve commissions, board, bureau agency or instrumentality,
domestic or foreign, which involve the likelihood of any adverse
judgment of liability, not fully covered by insurance, in excess
of $5,000 in any one case or $10,000 in the aggregate, or which
may result in any material adverse change aside from a monetary
adverse judgment or liability) in the business, operations,
properties or assets or in the condition, financial or otherwise,
of Acquiree, except in each as listed and described in Exhibit
4.4 annexed hereto. To the extent actually known by the
Principals, Acquiree is not in default with respect to any order,
writ, injunction or decree of any court or federal, state,
municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign.
4.5 Acquiree has, to the extent of facts actually known by the
2 of 12
3
Principals and Acquiree, complied in all material respects with
all laws, regulations and judicial or administrative tribunal
orders applicable to its business of which it is aware.
4.6 All federal, state and local tax returns required to be
filed by Acquiree have been duly files. Federal income tax
returns of Acquiree have been submitted the Internal Revenue
Service ("IRS") for all past fiscal years through the calendar
year ending 1995.
All deficiencies by any taxing authority have either been paid or
settled or are included in the amounts of accrued/taxes shown on
the respective balance sheet (part of Exhibit 4.6 annexed
hereto).
4.7 Principals agree that any and all tax deficiencies, if
any, disclosed on the balance sheet will be paid or settled prior
to Closing.
4.8 Since the date of the balance sheet there has not
occurred:
(i) any material and adverse change
in the financial condition or operation
Acquiree;
(ii) any damage, destruction or loss
to or of any of the material assets or
properties owned or leased by Acquiree;
(iii) the creation or attachment of
any lien against any of the currently issued
and distributed common stock of Acquiree;
(iv) any waiver, release, discharge,
transfer, or cancellation by Acquire of any
rights or claims or material value;
(v) any issuance by Acquiree of any
securities, or any merger or consolidation of
Acquiree with any other person, or any
acquisition by Acquiree of the business of
any other person;
(vi) any incurrence, assumption or
guarantee by Acquiree of any indebtedness or
liability other than in the ordinary course
of business;
(vii) any declaration, setting aside
or payment by Acquiree of any dividends on,
or any other distribution with respect to,
any capital stock of Acquiree or any
repurchase, redemption, or other acquisition
of any capital stock of Acquiree;
(viii) (A) any payment of any bonus,
profit sharing, pension or similar payment or
arrangement or special compensation to any
employee of Acquiree, except in the ordinary
course of the business of Acquiree, or (B)
any increase in the compensation payable or
to become payable to any employee of
Acquiree; or
4.9 Except as set forth in the documents listed or referred
to in Exhibits hereto, the execution and carrying out of this
Agreement will not conflict with, or result in any breach of any
of the terms, or create a charge or
3 of 12
4
encumbrance upon any of the properties or assets, or outstanding
stock of Acquiree pursuant to any corporate charter, by-law,
indenture, mortgage or lease to which Acquiree or any of its
stockholders is a party or by which it is bound.
The execution and carrying out of this Agreement will not violate
any provision of law.
4.10 To the extent of the fact known to Principals and
Acquiree, none of the written information and documents which
have been or will be furnished by Principals and Acquiree or by
any representatives of Principals and Acquiree to
Buyer or any of the representatives of Buyer in connection with
the transactions contemplated by this Agreement contains or will
contain, as the case may be, any untrue statement of a material
fact, or omits or will omit to state a material fact necessary in
order to make the statements therein not misleading in light of
the circumstances in which made. To the extent of the facts
known to Principals and Acquiree, Principals and Acquiree have
disclosed to Buyer as the purchaser of the Sale Shares all
material information relating to Acquiree and its activities as
currently conducted.
4.11 The representations and warranties made hereinabove in
this Section (3) will be correct in all material respects on and
as of the Closing Date with the same force and effect as though
such representations and warranties had been made on the Closing
Date.
4.12 The Acquiree is authorized to issue 5,000,000 shares of
common stock, $.001 par value, of which 1,159,305 shares are
issued and outstanding. Acquiree has only one class of capital
stock and all outstanding shares have been duly authorized,
validly issued and are fully paid and nonassessable with no
personal liability attaching to the ownership thereof. There are
no outstanding convertible securities, warrants, options or
commitments of any nature which may cause authorized but un-
issued shares to be issued to any person.
4.13 Shareholders have been fully advised by Buyer that
Buyer will issue its common shares to Principals and Shareholders
without registration under the Act on the basis of the statutory
exemption in Section 4(2) of the Act relating to transactions to
involving a public offering and Rule 260.105.17 of the California
Corp. Code and that Principals and Shareholders reliance upon the
statutory exemption is based in large part upon Buyer's
representations made in this Agreement.
4.14 Principals and Shareholders are requiring the common
shares of Buyer for investment for its own account and not with a
view to resell or otherwise distribute the Sale Shares. In
making the forgoing representations, Principals and Shareholders
understand that in the view of the Securities and Exchange
Commission, the statutory exemption under Section 4(2) would not
be available if, notwithstanding Buyer's representations, it had
in mind merely acquiring the common shares for resale upon the
occurrence or nonoccurrence of some predetermined event.
5. Representations by Buyer.
Buyer warrants and represents, to the extent of the facts known
to Buyer, that, effective this date and the Closing Date, the
representations listed below are true and correct.
5.1 Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Missouri.
4 of 12
5
5.2 The Board of Directors of Buyer have duly approved this
Agreement.
5.3 The Buyer's restricted common shares deliverable
pursuant to this Agreement shall be validly issued and
outstanding, fully paid and nonassessable.
5.4 The authorized capital stock of Buyer consists of
20,000,000 shares of Common Stock. $.001 par value, 2,439,920
shares of which have been validly issued and are outstanding and
1,000,000 shares of Preferred Stock $10.00 par value, 9,000 of
which have been validly issued and are outstanding.
5.5 Annexed hereto as Exhibit 5.5 is the unaudited
financial statements dated June 30, 1996. The financial
statements in Exhibit 5.5 are substantially correct and complete
and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis. The
financial statements present fairly the financial condition of
Buyer as of the respective dates of said balance sheets and the
results of operations for the respective periods indicated in
said statements of income and retained earnings and, in the case
of each such interim statement, is subject to year-end
adjustments consistent with past practice.
5.6 To the extent of the facts known to Buyer, there are no
actions, suits, proceedings or investigations (whether or not
purportedly on behalf of Buyer) pending or, threatened against or
affecting Buyer, at law, or in equity or admiralty, or before or
by any federal, state, municipal or other governmental
department, commission, board, bureau agency or instrumentality,
domestic or foreign, which involve the likelihood of any adverse
judgment of liability, not fully covered by insurance, in excess
of $5,000 in any one case or $10,000 in the aggregate, or which
may result in any material adverse change aside from a monetary
adverse judgment or liability) in the business, operations,
properties or assets or in the condition, financial or otherwise,
of Buyer, except in each as listed and described in Exhibit 5.6
annexed hereto. To the extent of the facts known to Buyer, Buyer
is not in default with respect to any order, writ, injunction or
decree of any court or federal, state, municipal or other
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign.
5.7 Buyer has complied in all material respects with all
laws, regulations and judicial or administrative tribunal orders
applicable to its business of which it is aware.
5.8 All federal, state and local tax returns required to be
filed by Buyer have been duly filed. Federal income tax returns
of Buyer have been submitted to the IRS for all past fiscal years
through the fiscal year ended in 1994. All deficiencies proposed
by any taxing authority have either been paid or settled or are
included in the amounts for accrued taxes shown on the respective
balance (part of Exhibit 5.5 annexed hereto).
5.9 Since the date of the balance sheet there has not
occurred:
(i) any material and adverse change in the
financial condition or operations of Buyer;
(ii) any damage, destruction or loss to or of
any of the material assets or properties owned or
leased by Buyer;
(iii) the creation or attachment of any lien
against the issued and outstanding common stock of Buyer.
5 of 12
6
(iv) any waiver, release, discharge, transfer,
or cancellation by Buyer of any rights or claims of
material value;
(v) any issuance by Buyer of any
securities, or any merger or consolidation of
Buyer with any other person, or any
acquisition by Buyer of the business of any
other person;
(vi) any incurrence, assumption
or guarantee by Buyer of any indebtedness or
liability, except in the ordinary course of
business;
(vii) any declaration, setting aside
or payment by Buyer of any dividends on, or any
other distribution with respect to, any
capital stock or Buyer or any repurchase,
redemption, or other acquisition of any
capital stock of Buyer;
(viii) (A) any payment of any bonus,
profit sharing, pension or similar payment or
arrangement or special compensation to any
employee of Buyer, except in the ordinary
course of the administration of Buyer, or (B)
any increase in the compensation payable or
to become payable to any employee of Buyer;
or
5.10 Except as set forth in the documents listed or referred
to in Exhibits hereto, the execution and carrying out of this
Agreement will not conflict with, or result in any breach of any
of the terms, charge or encumbrance upon any of the properties or
assets, or outstanding stock of Buyer pursuant to any corporate
charter, by-law, indenture, mortgage or lease to which Buyer or
any of its stockholders is a party or by which it is bound. The
execution and carrying out of this Agreement will not violate any
provision of law.
5.11 None of the written information and documents which
have been or will be furnished by Buyer or any representatives of
Buyer to Principals and Acquiree or any of the representatives of
Principals and Acquiree in connection with the transactions
contemplate by this Agreement contains or will contain, as the
case may be, any untrue statement of material fact, or omits or
will omit to state a material fact necessary in order to make the
statements therein not misleading in light of the circumstances
in which made. To the knowledge of Buyer, Buyer has disclosed to
Principals and Aquiree as the purchaser of the common stock of
Buyer all material information relating to Buyer and its
activities as currently conducted.
5.12 The representations and warranties made hereinabove in
this Section (4) will be correct in all material respects on and
as of the Closing Date with the same force and effect as though
such representations and warranties had been made on the Closing
Date.
5.13 Buyer is fully aware of the condition and prospects,
financial and otherwise, of the Acquiree, having been supplied
with such financial and other data relating to the Acquiree as
Buyer considered necessary and advisable to enable it to for a
decision concerning the purchase herein provided.
5.14 Buyer is fully aware that the Sale Shares, when
delivered, will not have been registered under the Act; that
accordingly no sale, offer to sell or transfer of the Sales
Shares shall be made unless a registration statement under the
Act with respect to the Sale Shares is then in effect or an
exemption from the registration requirements of the Act is then
in fact applicable to the Sale
6 of 12
7
Shares or, in the opinion of Acquiree's counsel, registration is
not required.
5.15 Buyer has been fully advised by Principals and
Shareholders that Principals and Shareholders will sell the Sale
Shares to Buyer without registration under the Act on the basis
of the statutory exemption in Section 4(2) of the Act relating to
transactions not involving a public offering and that Principals'
and Shareholders' reliance upon the statutory exemption is based
in large part upon Buyer's representations made in this
Agreement.
5.16 Buyer is acquiring the Sales Shares for investment for
its own account and not with a view to resell or otherwise
distribute the Sale Shares. In making the foregoing
representations, Buyer understands that, in the view of the
Securities and Exchange Commission, the statutory exemption under
Section 4(2) would not be available if, notwithstanding Buyer's
representations, it had in mind merely acquiring the Sale Shares
for resale upon the occurrence or nonoccurrence of some
predetermined event.
5.17 Buyer has the full right, power and authority to
purchase the Sales Shares in accordance with the terms of this
agreement and otherwise to consummate and close the transaction
provided for in this agreement in the manner and upon the terms
herein specified.
5.18 Buyer is acquiring the Sale Shares for the purpose of
controlling Acquiree.
5.19 Buyer represents that copies of all documents filed
with the Securities and Exchange Commission for the past one year
period have been provided to Shareholders and that all
representations contained therein remain true and complete.
6. Closing Date and Place.
The Closing Date herein referred to shall be upon such date
as the parties hereto may mutually agree upon but is expected to
be September 23, 1996 and shall occur at Sacramento, California.
At the Closing, Buyer will be provided with and accept delivery
of the Sale Share, and in connection therewith, and will make
payment of all sums due to Shareholders. Certain closing
documents may be delivered subsequent to the Closing Date upon
the mutual agreement of the parties hereto.
7. Conditions Precedent To the Obligation of Shareholders under
this agreement are subject to the fulfillment, prior to or as of
the Closing Date, of each of the following conditions;
7.1 The negotiation and execution of an employment
agreement between Xxxxx Xxxxxx and Cra-Tek Company on terms and
conditions agreeable to the parties thereto providing for a base
salary, benefits and mutually agreed incentive compensation based
on performance measures.
7.2 The representations and warranties by Buyer contained
in this Agreement or in any certificate or document delivered to
Principals pursuant to the provisions hereof shall be true in all
material respects at and as of the time of Closing as though such
representations and warranties were made at and as of such time.
7.3 Buyer shall have performed and complied with all
covenants, agreements, and conditions required by this Agreement
to be performed or complied with by him prior to or at the
Closing including the payment of the Price in
7 of 12
8
accordance with the terms hereof.
7.4 All instruments and documents delivered to Principals
and Shareholders pursuant to the provisions hereof shall be
reasonably satisfactory to the appropriate legal counsel.
7.5 Buyer will assume all personal guarantees currently
outstanding on behalf of Cra-Tek Company, by Xxxxx X. Xxxxxx or
any other Cra-Tek Employee.
8. Conditions, Precedent To The Obligations Of Buyer.
8.1 Discussions acceptable to Buyer are suppliers and
customers of the Acquiree have occurred. However, no such
discussions and communications with such suppliers and customers
will occur without the consent and cooperation of the Acquiree.
8.2 The negotiation and execution of a mutually acceptable
lease with respect to the Acquiree's office space.
8.3 A financial review of Acquiree's books and records to
confirm that two (2) years of complied financial statements can
be obtained.
8.4 The representations and warranties by Principals
contained in this Agreement or in any certificate or document
delivered to Buyer pursuant to the provisions hereof shall be
true at and as of the time of Closing as though such
representations and warrantees were made at and as of such time.
8.5 Principals and Aquiree shall have prepared and filed
all governmental, tax or related returns and reports due or
required to be filed and have arranged for payment of all taxes
or assessments which have become due as of Closing.
8.6 Principals shall have performed and complied with all
other convenants, agreements and conditions required by this to
be performed or complied with by them prior to or at the Closing
and all documents or instruments delivered by them are reasonably
satisfactory to Buyers Counsel.
9. Documents At Closing.
At the Closing, the following transactions shall occur, all of
such transaction being deemed to occur simultaneously:
9.1 Principals and Shareholders, as the case may be, will
deliver, or cause to be delivered, to Buyer the following:
a. stock certificates for the Sale Shares, duly endorsed
in blank/black with appropriate signature guarantees.
b. all records of Acquiree, including without limitation
such books and records, charter documents and a certificate of
good standing, as may reasonably be available to Principals and
Shareholders and requested by Buyer.
c. certified copies of resolutions by Acquiree's boards of
directors or executive committees thereof, thereunto duly
authorized, authorizing this transaction.
8 of 12
9
d. a copy of a reasonably current shareholder list of
Acquiree certifying the number of shares outstanding.
e. current financial statement, in addition to those
provided by Exhibit 4.3 of Acquiree showing no assets or debts of
any substance not otherwise disclosed, except for such sums as
may be owned to Acquirees transfer agent and certain nominal
state taxes.
f. such other instruments, documents and certificates, if
any, as are required to be delivered pursuant to the provisions
of this Agreement or which may be reasonably requested in
furtherance of the provisions of this Agreement;
9.2 Buyer will deliver or cause to be delivered to
Principals and such other instruments and documents as are
required to be delivered pursuant to the provisions of this
Agreement or which may be reasonably requested in furtherance of
the provisions of this Agreement.
10.Miscellaneous
10.1 The respective representations of Principals and Buyer
contained herein or in any certificates delivered prior to or at
Closing shall survive for a period of two (2) years from the
Closing Date.
10.2 Finders Fee. The Buyer shall be solely responsible for
the payment of the Finders Fee, payable to Xxxxxxx X. Xxxx. Said
fee shall be based on the full purchase price of $1,750,000. His
fees are 5% of the first million and 4% of the $750,000 balance.
These fees are to be in the form of common stock of Applied
Cellular Technology, Inc.
10.3 Further Assurance. At any time, and from time to time,
after the effective date, 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.
10.4 Waiver. Any failure on the part of any party hereto to
comply with any of its obligations, agreements or conditions
hereunder may be waived in writing by the party to who such
compliance is owed.
10.5 Arbitration. Any and all disputes and differences
between or among the parties with respect to the construction or
performance of the terms of this Agreement which cannot be
resolved amicably shall be resolved by arbitration before the
American Arbitration Association in accordance with its rules
then obtaining sitting in California.
10.6 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been
given if delivered in person or if sent by prepaid first class
registered or certified mail, return receipt requested, fax or
recognized courier then upon receipt thereof to the following
address:
To Shareholders who are Principals: Xxxxx Xxxxxx
Cra-Tek Company
0000 00xx Xxxxxx
Xxxxxxxxxx, XX 00000
9 of 12
10
Xxxx Xxxxx
C.F.A. Financial Services
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
TO SHAREHOLDERS WHO ARE NOT PRINCIPALS: XXXXX XXXXXXX
0000 XXXXXXXX XXXX
XXXXXXX XXXX, XX 00000
XXXXXXX XXXXXX
0000 X.X. 00XX XXXXXX
XXXXXXXXX, XX 00000
XXXX XXXXXX
0000 XXXXXX XXX
XXXXXX XXXXXXX, XX 00000
XXXX XXXXXXX
0000 XXXXXXXX XXXX
XXXXXXXXXX, XX 00000
XXXXXXX XXXXXXXX
0000 XXXXXXXXXX XXXXXX
XXXXXXX XXX, XX 00000
XXXX XXXXXXXXXXX
0000 XXXXX XXXXX XXXX
XXXXXX, XX 00000
XXX XXXX
0000 XXXXXXX XXXXX
XXXXXXXXXX, XX 00000
XXXXXX XXXXXXXXXX
0000 XXXXXXX XXXX
XXXXXX, XX 00000
XXXXX XXXXXXXXX
0000 XXXXXX XXXXX #X
XXXXXXXXXX, XX 00000
XXX UNKLESS
**UNKNOWN**
TO BUYER: XX. XXXXXXX XXXXXXXX
APPLIED CELLULAR TECHNOLOGY, INC.
NIXA PROFESSIONAL CENTER
XXX. 000 & XX
XXXXX 0
XXXX, XXXXXXXX 00000
WITH COPIES TO ACQUIREE: CRA-TEK COMPANY
0000 00 XXXXXX
XXXXXXXXXX, XX. 00000
10 OF 12
11
10.7 Headings. The section and subsection headings
in the Agreement are inserted for convenience only and shall
not affect in any way the meaning or interpretation of this
Agreement.
10.8 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.
10.9 Governing Law. This Agreement shall be governed
by the laws of the State of California.
10.10 Binding Effect. This Agreement shall be binding
upon the parties hereto and inure to the to the benefit of
the parties, their respective heirs, administrators,
executors, successors and assigns.
10.11 Entire Agreement. This Agreement is the entire
agreement of the parties covering everything agreed up or
understood in the transaction. There are no oral promises,
conditions, representations, understandings, interpretations
or terms of any kind as conditions or inducements to the
execution hereof.
10.12 Severability. If any part of this Agreement is
deemed to be unenforceable the balance of this Agreement
shall remain in full force and effect.
Agreed and accepted by:
PRINCIPALS:
/s/ Xxxxx X. Xxxxxx Date September 23, 1996
----------------------------------- ------------------
Xxxxx X. Xxxxxx
/s/ Xxxx Xxxxx Date September 23, 1996
----------------------------------- ------------------
Xxxx Xxxxx
Applied Cellular Technology, Inc.
/s/ Xxxxxxx X. Xxxxxxxx Date September 23, 1996
----------------------------------- ------------------
Xxxxxxx X. Xxxxxxxx, Chairman
11 of 12
12
APPLIED CELLULAR TECHNOLOGY, INC./CRA-TEK COMPANY - EXCHANGE MATRIX
EXHIBIT "A"
Before After
----------------------------------------------------------------------- ----------------------------
APPLIED CRA-TEK
CRA-TEK COMPANY CELLULAR COMPANY
--------------------------------------------------------------------------------------------- ---------------------------
SHAREHOLDER NAME Shares Owned Shares Tendered Shares Remaining Shares Owned Shares Owned
--------------------------------------------------------------------------------------------- ---------------------------
Total (%) Total (%) Total (%) Total Total
--------------------------------------------------------------------------------------------- ---------------------------
Xxxxx Xxxxxx 682,660 58.89% 475,000 69.6% 207,660 30.4% 151,000 207,660
------------------------------------------------------------------------------------------- ---------------------------
Xxxx Xxxxxx 112,350 9.69% 112,350 100.0% 0 0.0% 35,715 0
Xxxxxxx Xxxxxxxx 109,674 9.46% 109,674 100.0% 0 0.0% 34,865 0
------------------------------------------------------------------------------------------- ---------------------------
Xxxx Xxxxx 105,791 9.13% 84,633 80.0% 21,158 20.0% 26,904 21,158
------------------------------------------------------------------------------------------- ---------------------------
Xxxxxx Xxxxxxxxxx 44,940 3.88% 44,940 100.0% 0 0.0% 14,286 0
Xxxx Xxxxxxx 22,470 1.94% 22,470 100.0% 0 0.0% 7,143 0
Xxx Xxxx 22,470 1.94% 22,470 100.0% 0 0.0% 7,143 0
Xxxxxxx Xxxxxx 21,934 1.89% 21,934 100.0% 0 0.0% 6,973 0
Xxxxx Xxxxxxx 11,234 0.97% 11,234 100.0% 0 0.0% 3,571 0
Xxxx Xxxxxxxxxxx 11,234 0.97% 11,234 100.0% 0 0.0% 3,571 0
------------------------------------------------------------------------------------------- ---------------------------
Xxxxx Xxxxxxxxx 10,700 0.92% 8,560 80.0% 2,140 20.0% 2,721 2,140
------------------------------------------------------------------------------------------- ---------------------------
Xxx Unkless 3,848 0.33% 3,848 100.0% 0 0.0% 1,223 0
----- ----- ----- ------ - ---- ----- -
TOTALS 1,159,305 100.0% 928,347 80.1% 230,958 19.9% 295,115 230,958
------------------------------------------------------------------------------------------- ---------------------------
12 of 12
13
WAIVER OF NOTICE OF SPECIAL MEETING
OF THE BOARD OF DIRECTORS
OF APPLIED CELLULAR TECHNOLOGY, INC.
We, the undersigned, being all of the Directors of the Corporation, hereby
agree and consent that a special meeting of the Board of Directors of the
Corporation be held on the date and time and at the place designated
hereunder, and do hereby waive all notice whatsoever of such meeting and of
any adjournment or adjournments thereof.
We do further agree and consent that any and all lawful business may be
transacted at such meeting or at any adjournment or adjournments thereof as
may be deemed advisable by the Directors present thereat. Any business
transacted at such meeting or at any adjournment or adjournments thereof
shall be valid and legal and of the same force and effect as if such meeting
or adjournment were held after notice.
Place of Meeting: Xxxxx River Professional Center
Xxxxx 0
Xxx 000 & XX
Xxxx, XX 00000
Date of Meeting: September 23, 1996
Time of Meeting: 3:00 p.m.
Purpose of Meeting: Issuance of common shares relating to the purchase of
Cra-Tek Company
----------------------------------------
Xxxxxxx X. Xxxxxxxx, Director
----------------------------------------
Xxxxxxx X. Xxxxxxxx, Director
----------------------------------------
Xxxxxx X. Xxxxx, Director
----------------------------------------
Xxxxxx X. Xxxxxxxx, Director
14
MINUTES OF THE SPECIAL MEETING
OF THE BOARD OF DIRECTORS
OF APPLIED CELLULAR TECHNOLOGY, INC.
A Special Meeting of the Board of Directors of Applied Cellular Technology,
Inc. (the "Corporation") was held on the date, time and at the place set forth
in the written waiver of notice signed by all the Directors, fixing such time
and place, and prefixed to the minutes of this meeting.
The meeting was duly called to order by Xxxxxxx Xxxxxxxx, Chairman of the
Board of Directors.
The Agreement and Plan of Reorganization ("the Agreement") between Cra-Tek
Company and the Corporation was presented to the meeting. After discussion,
upon motion duly made, seconded and carried, it was
RESOLVED, that the Corporation will execute the terms of the Agreement, for
the purpose of acquiring at least 80% of Cra-Tek Company.
RESOLVED, that pursuant to the Agreement, 295,115 common shares of the
Corporation's common stock be authorized for issuance to purchase a total of
928,347 Cra-Tek shares from twelve Cra-Tek shareholders individually. The ACTC
shares will be valued at $1,401,796, based on the Nasdaq bid price per share of
$4.75 on August 30, 1996. The shares will bear the Rule-144 restrictive legend.
RESOLVED, that pursuant to the Agreement, 16,842 common shares of the
Corporation's common stock be authorized for issuance to Xxxxxxx X. Xxxx as
payment of the finder's fee, based on $80,000 in shares at $4.75 per share.
The shares will bear the Rule-144 restrictive legend.
FURTHER RESOLVED, that the officers are authorized to do whatever necessary to
issue the required securities and to file the required documentation, if any,
with the Securities and Exchange Commission.
---------------------------------------
Secretary
Attest: ________________________________________
President
