VERBENA PHARMACEUTICALS, INC.
VERBENA
PHARMACEUTICALS,
INC.
AGREEMENT
AND PLAN OF MERGER,
dated
as of August ____, 2007 (the “Agreement”), among
Verbena
Pharmaceuticals, Inc.,
a
Delaware Corporation (“VERBENA”), also known as the “Company” and American
Building Company,
a
Florida corporation (“AMERICAN BUILDING COMPANY”); collectively referred to
herein as the “parties”.
RECITALS
WHEREAS,
the
respective boards of directors of each of Verbena and American Building Company
have approved the merger of American Building Company with and into the Company
(the “Merger”) upon the terms, and subject to the conditions, set forth in this
Agreement;
WHEREAS,
American Building Company shareholders will own in the aggregate 48% of the
outstanding capital stock of VERBENA and will benefit from the transactions
contemplated herein.
WHEREAS,
it is
intended that, for federal income tax purposes, the Merger shall qualify as
a
reorganization under the provisions of Section 368(a) of the Internal Revenue
Code of 1986, as amended, and the rules and regulations promulgated there under
(the “Code”); and
WHEREAS,
American Building Company and the Company desire to make certain
representations, warranties, covenants and agreements in connection with this
Agreement.
NOW,
THEREFORE,
in
consideration of the premises and mutual promises herein made, and in
consideration of the representations, warranties, covenants and agreements
herein contained, and intending to be legally bound hereby, the Parties agree
as
follows:
ARTICLE
I
DEFINITIONS
1.1 Certain
Definitions.
The
following terms shall, when used in this Agreement, have the following
meanings:
“Acquisition”
means the acquisition by a Person of any businesses, assets or property other
than in the ordinary course, whether by way of the purchase of assets or stock,
by merger, consolidation or otherwise.
“Affiliate”
means, with respect to any Person: (i) any Person directly or indirectly owning,
controlling or holding with power to vote ten percent (10%) or more of the
outstanding voting securities of such other Person (other than passive or
institutional investors); (ii) any Person ten percent (10%) or more of whose
outstanding voting securities are directly or indirectly owned, controlled
or
held with power to vote, by such other Person; (iii) any Person directly or
indirectly controlling, controlled by or under common control with such other
Person; and (iv) any officer, director or partner of such other Person.
“Control” for the foregoing purposes shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
and
policies of a Person, whether through the ownership of voting securities or
voting interests, by contract or otherwise.
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“Business
Day” means any day other than Saturday, Sunday or a day on which banking
institutions in Delaware are required or authorized to be closed.
“Code”
means the United States Internal Revenue Code of 1986, as amended.
“Collateral
Documents” mean the Exhibits and any other documents, instruments and
certificates to be executed and delivered by the Parties hereunder or there
under.
“Commission”
means the Securities and Exchange Commission or any Regulatory Authority that
succeeds to its functions.
“Company
Assets” mean all properties, assets, privileges, powers, rights, interests and
claims of every type and description that are owned, leased, held, used or
useful in the Company Business and in which the Company has any right, title
or
interest or in which the Company acquires any right, title or interest on or
before the Closing Date, wherever located, whether known or unknown, and whether
or not now or on the Closing Date on the books and records of the Company,
but
excluding any of the foregoing, if any, transferred prior to the Closing
pursuant to this Agreement or any Collateral Documents.
“Company
Business” means the acquisition and operating of sports and entertainment
events.
“Company
Common Stock” means the common shares of the Company.
“Company
Shareholders” means, as of any particular date, the holders of Company Common
Stock on that date.
“Encumbrance”
means any material mortgage, pledge, lien, encumbrance, charge, security
interest, security agreement, conditional sale or other title retention
agreement, limitation, option, assessment, restrictive agreement, restriction,
adverse interest, restriction on transfer or exception to or material defect
in
title or other ownership interest (including restrictive covenants, leases
and
licenses).
“ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations there under.
“GAAP”
means United States generally accepted accounting principles as in effect from
time to time.
“Legal
Requirement” means any statute, ordinance, law, rule, regulation, code,
injunction, judgment, order, decree, ruling, or other requirement enacted,
adopted or applied by any Regulatory Authority, including judicial decisions
applying common law or interpreting any other Legal Requirement.
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“Losses”
shall mean all damages, awards, judgments, assessments, fines, sanctions,
penalties, charges, costs, expenses, payments, diminutions in value and other
losses, however suffered or characterized, all interest thereon, all costs
and
expenses of investigating any claim, lawsuit or arbitration and any appeal
there
from, all actual attorneys’, accountants’ investment bankers’ and expert
witness’ fees incurred in connection therewith, whether or not such claim,
lawsuit or arbitration is ultimately defeated and, subject to Section 9.4,
all
amounts paid incident to any compromise or settlement of any such claim, lawsuit
or arbitration.
“Liability”
means any liability or obligation (whether known or unknown, whether asserted
or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due), including
any liability for Taxes.
“Material
Adverse Effect” means a material adverse effect on (i) the assets, Liabilities,
properties or business of the Parties, (ii) the validity, binding effect or
enforceability of this Agreement or the Collateral Documents or (iii) the
ability of any Party to perform its obligations under this Agreement and the
Collateral Documents; provided, however, that none of the following shall
constitute a Material Adverse Effect on the Company: (i) the filing, initiation
and subsequent prosecution, by or on behalf of shareholders of any Party, of
litigation that challenges or otherwise seeks damages with respect to the
Merger, this Agreement and/or transactions contemplated thereby or hereby,
(ii)
occurrences due to a disruption of a Party’s business as a result of the
announcement of the execution of this Agreement or changes caused by the taking
of action required by this Agreement, (iii) general economic conditions, or
(iv)
any changes generally affecting the industries in which a Party
operates.
“Merger
Shares” means the shares of AMERICAN BUILDING COMPANY Common Stock deliverable
by AMERICAN BUILDING COMPANY in exchange for Company Common Stock pursuant
to
Section 2.6.
“AMERICAN
BUILDING COMPANY Assets” mean all properties, assets, privileges, powers,
rights, interests and claims of every type and description that are owned,
leased, held, used or useful in the AMERICAN BUILDING COMPANY Business and
in
which AMERICAN BUILDING COMPANY or any of its Subsidiaries has any right, title
or interest or in which AMERICAN BUILDING COMPANY or any of its Subsidiaries
acquires any right, title or interest on or before the Closing Date, wherever
located, whether known or unknown, and whether or not now or on the Closing
Date
on the books and records of AMERICAN BUILDING COMPANY or any of its
Subsidiaries.
“AMERICAN
BUILDING COMPANY Business” means the business conducted by AMERICAN BUILDING
COMPANY.
“AMERICAN
BUILDING COMPANY Common Stock” means the common shares of AMERICAN BUILDING
COMPANY.
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“AMERICAN
BUILDING COMPANY Preferred Stock” means the preferred shares of AMERICAN
BUILDING COMPANY.
“AMERICAN
BUILDING COMPANY Securities Filings” means AMERICAN BUILDING COMPANY‘s Annual
Report on Form 10-KSB and its quarterly reports on Form 10-QSB, and all other
reports filed and to be filed with the Commission prior to the Effective
Time.
“Permit”
means any license, permit, consent, approval, registration, authorization,
qualification or similar right granted by a Regulatory Authority.
“Permitted
Liens” means (i) liens for Taxes not yet due and payable or being contested in
good faith by appropriate proceedings; (ii) rights reserved to any Regulatory
Authority to regulate the affected property; (iii) statutory liens of banks
and
rights of set off; (iv) as to leased assets, interests of the lessors and
sublessors thereof and liens affecting the interests of the lessors and
sublessors thereof; (v) inchoate materialmen’s, mechanics’, workmen’s,
repairmen’s or other like liens arising in the ordinary course of business; (vi)
liens incurred or deposits made in the ordinary course in connection with
workers’ compensation and other types of social security; (vii) licenses of
trademarks or other intellectual property rights granted by the Company or
AMERICAN BUILDING COMPANY, as the case may be, in the ordinary course and not
interfering in any material respect with the ordinary course of the business
of
the Company or AMERICAN BUILDING COMPANY, as the case may be; and (viii) as
to
real property, any encumbrance, adverse interest, constructive or other trust,
claim, attachment, exception to or defect in title or other ownership interest
(including, but not limited to, reservations, rights of entry, rights of first
refusal, possibilities of reverter, encroachments, easement, rights of way,
restrictive covenants, leases, and licenses) of any kind, which otherwise
constitutes an interest in or claim against property, whether arising pursuant
to any Legal Requirement, under any contract or otherwise, that do not,
individually or in the aggregate, materially and adversely affect or impair
the
value or use thereof as it is currently being used in the ordinary
course.
“Person”
means any natural person, corporation, partnership, trust, unincorporated
organization, association, limited liability company, Regulatory Authority
or
other entity.
“Proposed
Acquisition” means any of the following transactions (other than the
transactions contemplated by this Agreement): (i) a merger, consolidation,
business combination, recapitalization, liquidation, dissolution or similar
transaction involving the Company pursuant to which the shareholders of the
Company immediately preceding such transaction hold less than fifty percent
(50%) of the aggregate equity interests in the surviving or resulting entity
of
such transaction, (ii) a sale or other disposition by the Company of assets
representing in excess of fifty percent (50%) of the aggregate fair market
value
of the Company Business immediately prior to such sale or (iii) the acquisition
by any person or group (including by way of a tender offer or an exchange offer
or issuance by the Company), directly or indirectly, of beneficial ownership
or
a right to acquire beneficial ownership of shares representing in excess of
fifty percent (50%) of the voting power of the then outstanding shares of
capital stock of the Company.
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“Regulatory
Authority” means: (i) the United States of America; (ii) any state,
commonwealth, territory or possession of the United States of America and any
political subdivision thereof (including counties, municipalities and the like);
(iii) Canada and any other foreign (as to the United States of America)
sovereign entity and any political subdivision thereof; or (iv) any agency,
authority or instrumentality of any of the foregoing, including any court,
tribunal, department, bureau, commission or board.
“Representative”
means any director, officer, employee, agent, consultant, advisor or other
representative of a Person, including legal counsel, accountants and financial
advisors.
“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations
there under.
“Subsidiary”
of a specified Person means (a) any Person if securities having ordinary voting
power (at the time in question and without regard to the happening of any
contingency) to elect a majority of the directors, trustees, managers or other
governing body of such Person are held or controlled by the specified Person
or
a Subsidiary of the specified Person; (b) any Person in which the specified
Person and its subsidiaries collectively hold a fifty percent (50%) or greater
equity interest; (c) any partnership or similar organization in which the
specified Person or subsidiary of the specified Person is a general partner;
or
(d) any Person the management of which is directly or indirectly controlled
by
the specified Person and its Subsidiaries through the exercise of voting power,
by contract or otherwise.
“Tax”
means any U.S. or non U.S. federal, state, provincial, local or foreign income,
gross receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, windfall profits, environmental, customs duties, capital,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, intangible property, recording,
occupancy, sales, use, transfer, registration, value added minimum, estimated
or
other tax of any kind whatsoever, including any interest, additions to tax,
penalties, fees, deficiencies, assessments, additions or other charges of any
nature with respect thereto, whether disputed or not.
“Tax
Return” means any return, declaration, report, claim for refund or credit or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
“Treasury
Regulations” means regulations promulgated by the U.S. Treasury Department under
the Code.
1.2 Other
Definitions.
The
following terms shall, when used in this Agreement, have the meanings assigned
to such terms in the Sections indicated.
Term
|
Schedule
|
|
“Agreement”
|
Preamble
|
|
“Bridge
Financing
|
8.12
|
|
“DCC”
|
2.1
|
|
“Certificate
of Merger”
|
2.5
|
|
“Closing”.
|
2.12
|
|
“Closing
Date”
|
2.12
|
|
“Company
Common Stock”
|
2.7(a)
|
|
“Company
Certificates”
|
2.7(a)
|
|
“Company
Financial Statements”
|
3.8
|
|
“Company
Intellectual Property Rights”
|
3.6
|
|
“Company
Option”
|
2.6(b)
|
|
“Conversion”
|
2.6(a)(ii)
|
|
“Current
Market Price”
|
2.7(a)
|
|
“Dissenting
Shares”
|
2.9
|
|
“Effective
Time”
|
2.5
|
|
“Excluded
Shares”
|
2.6(a)
|
|
“Material
Company Contract”
|
3.4
|
|
“Material
AMERICAN BUILDING COMPANY Contract”
|
4.4
|
|
“Merger”
|
2.1
|
|
“Options”
|
3.2(b)
|
|
“Parties”
|
Preamble
|
|
“Post
Closing Financing”
|
2.6(a)
|
|
“Preferred
Shares”
|
2.6(a)(ii)
|
|
“Shareholder
Meeting”
|
5.6
|
|
“Surviving
Corporation”
|
2.1
|
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5
ARTICLE
II
THE
MERGER
2.1 Merger;
Surviving Corporation.
In
accordance with and subject to the provisions of this Agreement and the Delaware
Corporations Code (“DCC”), at the Effective Time, American Building Company
shall be merged with and into the Company (the “Merger”), and the Company shall
be the surviving corporation in the Merger (hereinafter sometimes called the
“Surviving Corporation”) and shall continue its corporate existence under the
laws of the State of Delaware, and shall immediately effect a name change.
At
the Effective Time, the separate existence of the Company shall cease. All
properties, franchises and rights belonging to the Company and AMERICAN BUILDING
COMPANY, by virtue of the Merger and without further act or deed, shall be
vested in the Surviving Corporation, which shall thenceforth be responsible
for
all the liabilities and obligations of each of AMERICAN BUILDING COMPANY and
the
Company.
2.2 Articles
of Incorporation.
The
Company’s articles of incorporation, as in effect at the Effective Time, shall
continue in full force and effect as the articles of incorporation of the
Surviving Corporation until altered or amended as provided therein or by
law.
2.3 By
Laws.
The
Company’s by laws, as in effect at the Effective Time, shall be the by laws of
the Surviving Corporation until altered, amended or repealed as provided therein
or by law.
2.4 (Intentionally
deleted)
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2.5 Effective
Time.
The
Merger shall become effective at the time and date that the certificate of
merger of each of American Building Company and the Company (the “Certificate of
Merger”), in form and substance acceptable to the Parties, is accepted for
filing by the Secretary of State of the State of Delaware in accordance with
the
provisions related thereto. The Certificate of Merger shall be executed by
American Building Company and the Company and delivered to the Secretary of
State of the State of Delaware for filing on the Closing Date. The date and
time
when the Merger becomes effective are referred to herein as the “Effective
Time.”
2.6 Merger
Shares; Conversion and Cancellation of Securities.
(a) Conversion
of Company Common Stock.
At the
Effective Time, all shares of AMERICAN BUILDING COMPANY Common Stock outstanding
immediately before the Effective Time, other than shares described in Section
2.6(c) and other than Dissenting Shares (as defined in Section 2.9 below),
collectively, the “Excluded Shares”, shall be converted, by virtue of the
Merger, into twelve million nine hundred twenty three and seventy six
(12,923,076) shares of COMPANY Common Stock (the “Merger Shares”) so that the
holders of AMERICAN BUILDING COMPANY Common Stock will upon conversion of the
Merger Shares own approximately Forty Eight percent (48%) of COMPANY‘s issued
and outstanding capital stock (on a fully diluted basis) as of the Effective
Date after giving effect to the Merger but before the Private Placement
described in Section 8.11 below subject to the following:
(i) the
allocation of the Merger Shares among the Company Shareholders excluding the
holders of Dissenting Shares shall be delivered to AMERICAN BUILDING COMPANY
at
least one business day prior to the Closing;
At
the
Effective Time, all Company Shares shall no longer be outstanding and shall
be
cancelled and retired and shall cease to exist, and each certificate formerly
representing any Company Common Stock (other than Excluded Shares) shall
thereafter represent only the right to the Merger Shares and any distribution
or
dividend pursuant to Section .
(b) Stock
Options.
At the
Effective Time, each outstanding option to purchase Company Common Stock (a
“Company Option”), whether vested or unvested, shall be deemed to constitute an
option to acquire, on the same terms and conditions as were applicable under
such Company Option, the same number of shares of AMERICAN BUILDING COMPANY
Common Stock as the holder of such Company Option would have been entitled
to
receive pursuant to the Merger had such holder exercised such option in full
immediately prior to the Effective Time (rounded up to the nearest whole
number), at a price per share (rounded up to the nearest whole cent) equal
to
(i) the aggregate exercise price for the Company Common Stock otherwise
purchasable pursuant to such Company Option divided by (ii) the number of full
shares of AMERICAN BUILDING COMPANY Common Stock deemed purchasable pursuant
to
such Company Option in accordance with the foregoing. At or prior to the
Effective Time, AMERICAN BUILDING COMPANY shall take all corporate action
necessary to reserve for issuance a sufficient number of AMERICAN BUILDING
COMPANY Common Stock for delivery upon exercise of Company Options assumed
by it
in accordance with this Section.
(c) Treasury
Shares, Etc.
Each
share of Company Common Stock held in the treasury of the Company and (each
share of Company Common Stock, if any, held by AMERICAN BUILDING COMPANY or
of
the Company immediately before the Effective Time) shall be cancelled and
extinguished, and nothing shall be issued or paid in respect
thereof.
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(d) Fractional
Shares.
No
certificates or scrip evidencing fractional shares of AMERICAN BUILDING COMPANY
Preferred Stock shall be issued in exchange for Company Common Stock. All
fractional share amounts shall be rounded up to the nearest whole
share.
2.7 Surrender
of Company Certificates.
(a) Exchange
Procedures.
Promptly after the Effective Time, AMERICAN BUILDING COMPANY or its appointed
designee shall mail to each holder of a certificate or certificates of Company
Common Stock (“Company Certificates”) whose shares are converted into the right
to receive the Merger Shares, (i) a letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to the Company
Certificates shall pass to AMERICAN BUILDING COMPANY, only upon delivery of
the
Company Certificates to AMERICAN BUILDING COMPANY and which shall be in such
form and have such other provisions as AMERICAN BUILDING COMPANY may reasonably
specify) and (ii) instructions for use in effecting the surrender of the Company
Certificates in exchange for the Merger Shares and any dividends or other
distributions pursuant to Section. Upon surrender of Company Certificates for
cancellation to AMERICAN BUILDING COMPANY, together with such letter of
transmittal, duly completed and validly executed in accordance with the
instructions thereto, the holders of such Company Certificates shall be entitled
to receive the Merger Shares in exchange therefore and the Company Certificates
so surrendered shall forthwith be canceled. Notwithstanding the foregoing,
if
any Company Certificate is lost, stolen, destroyed or mutilated, such holder
shall provide evidence reasonably satisfactory to AMERICAN BUILDING COMPANY
as
to such loss, theft, destruction or mutilation and an affidavit in form and
substance satisfactory to AMERICAN BUILDING COMPANY, and, thereupon, such holder
shall be entitled to receive the Merger Shares in exchange therefore and the
Company Certificates so surrendered shall forthwith be canceled.
(b) Required
Withholding.
In
connection with any payment to any holder or former holder of the Company Common
Stock, each of AMERICAN BUILDING COMPANY and the Surviving Corporation shall
be
entitled to deduct and withhold from any consideration payable or otherwise
deliverable pursuant to this Agreement to any holder or former holder of the
Company Common Stock such amounts as may be required to be deducted or withheld
there from under the Code or under any provision of state, local or foreign
tax
law or under any other applicable laws. To the extent such amounts are so
deducted or withheld, such amounts shall be treated for all purposes under
this
Agreement as having been paid to the person to whom such amounts would otherwise
have been paid.
(c) No
Liability.
Notwithstanding anything to the contrary in this Section 2.7, neither AMERICAN
BUILDING COMPANY, the Surviving Corporation nor any party hereto shall be liable
to any Person for any amount properly paid to a public official pursuant to
any
applicable abandoned property, escheat or similar law. If any Company
Certificate shall not have been surrendered prior to the date immediately prior
to the date on which such property would otherwise escheat to or become the
property of any Governmental or Regulatory Authority, any such property, to
the
extent permitted by applicable law, shall become the property of the Surviving
Corporation, free and clear of all claims or interest of any person previously
entitled thereto.
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(d) Termination.
Any
holders of the Company Certificates who have not complied with this ARTICLE
II
shall look only to AMERICAN BUILDING COMPANY or the Surviving Corporation for,
and AMERICAN BUILDING COMPANY and the Surviving Corporation shall remain liable
for, payment of their claim for Merger Shares and any dividends or distributions
with respect to AMERICAN BUILDING COMPANY Common Stock, without interest
thereon.
2.8 Stock
Transfer Books.
At the
Effective Time, the stock transfer books of the Company shall be closed, and
there shall be no further registration of transfers of shares of Company Common
Stock thereafter on the records of the Company.
2.9 Dissenting
Shares.
Shares
of Company Common Stock which are issued and outstanding immediately prior
to
the Effective Time and which are held by persons who have properly exercised,
and not withdrawn or waived, appraisal rights with respect thereto in accordance
with the DCC (the “Dissenting Shares”), will not be converted into the right to
receive the Merger Shares, and holders of such shares of Company Common Stock
will be entitled, in lieu thereof, to receive payment of the appraised value
of
such shares of Company Common Stock in accordance with the provisions of the
DCC
unless and until such holders fail to perfect or effectively withdraw or lose
their rights to appraisal and payment under the DCC. If, after the Effective
Time, any such holder fails to perfect or effectively withdraws or loses such
right, such shares of Company Common Stock will thereupon be treated as if
they
had been converted at the Effective Time into the right to receive the Merger
Shares, without any interest thereon. The Company will give AMERICAN BUILDING
COMPANY prompt notice of any demands received by the Company for appraisal
of
shares of Company Common Stock. Prior to the Effective Time, the Company will
not, except with the prior written consent of AMERICAN BUILDING COMPANY, make
any payment with respect to, or settle or offer to settle, any such
demands.
2.10 Restriction
on Transfer.
The
Merger Shares may not be sold, transferred, or otherwise disposed of without
registration under the Act or an exemption there from, and that in the absence
of an effective registration statement covering the Merger Shares or any
available exemption from registration under the Act, the Merger Shares must
be
held indefinitely. The Company Shareholders are aware that the Merger Shares
may
not be sold pursuant to Rule 144 promulgated under the Act unless all of the
conditions of that Rule are met. Among the conditions for use of Rule 144 may
be
the availability of current information to the public about AMERICAN BUILDING
COMPANY.
2.11 Restrictive
Legend.
All
certificates representing the Merger Shares shall contain the following
legend:
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE, ARE SUBJECT TO THE TERMS OF AN
AGREEMENT AND PLAN OF MERGER, DATED AS OF November 26, 2007, BETWEEN AMERICAN
BUILDING COMPANY INDUSTRIES, INC. AND VERBENA PHARMACEUTICALS, INC., A COPY
OF
WHICH IS ON FILE IN THE PRINCIPAL OFFICE OF THE ISSUER. FURTHER, THE SECURITIES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE
DISPOSED OF WITHOUT REGISTRATION UNDER THE ACT OR AN EXEMPTION
THEREFROM.”
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2.12 Closing.
The
closing of the transactions contemplated by this Agreement and the Collateral
Documents (the “Closing”) shall take place at the offices of Genesis Holdings,
Inc., 00000 Xxx Xxxxx Xxx. Xxx 000, Xxx Xxxxxxx, Xx. 78216, or at such other
location as the parties may agree at 11:00 a.m., Pacific Time on the agreed
date, which, shall be within sixty (60) days of the signing hereof (the “Closing
Date”).
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
The
Company represents and warrants to AMERICAN BUILDING COMPANY that the statements
contained in this ARTICLE III are correct and complete as of the date of this
Agreement and, except as provided in Section 7.1, will be correct and complete
as of the Closing Date (as though made then and as though the Closing Date
were
substituted for the date of this Agreement throughout this ARTICLE III, except
in the case of representations and warranties stated to be made as of the date
of this Agreement or as of another date and except for changes contemplated
or
permitted by this Agreement).
3.1 Organization
and Qualification.
The
Company is a corporation duly organized, validly existing and in good standing
under the laws of its respective jurisdiction of organization. The Company
has
all requisite power and authority to own, lease and use its assets as they
are
currently owned, leased and used and to conduct its business as it is currently
conducted. The Company is duly qualified or licensed to do business in and
is in
good standing in each jurisdiction in which the character of the properties
owned, leased or used by it or the nature of the activities conducted by it
make
such qualification necessary, except any such jurisdiction where the failure
to
be so qualified or licensed would not have a Material Adverse Effect on the
Company or a material adverse effect on the validity, binding effect or
enforceability of this Agreement or the Collateral Documents or the ability
of
the Company to perform its obligations under this Agreement or any of the
Collateral Documents.
3.2 Capitalization.
(a) The
authorized capital stock and other ownership interests of the Company consist
of
100,000,000 shares of common stock, of which fourteen million (14,000,000)
shares were issued and outstanding as of the date hereof, and 0 shares of
Preferred Stock, none of which are outstanding. All of the outstanding Company
Common Stock have been duly authorized and are validly issued, fully paid and
nonassessable. It is anticipated that the number of shares of Company Common
Stock will increase as a result of private placements to be conducted after
the
date hereof.
(b) Schedule
3.2(b)(i) lists all outstanding or authorized options, warrants, purchase
rights, preemptive rights or other contracts or commitments that could require
the Company to issue, sell, or otherwise cause to become outstanding any of
its
capital stock or other ownership interests (collectively
“Options”).
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10
(c) All
of
the issued and outstanding shares of Company Common Stock have been duly
authorized and are validly issued and outstanding, fully paid and nonassessable
and have been issued in compliance with applicable securities laws and other
applicable Legal Requirements or transfer restrictions under applicable
securities laws.
3.3 Authority
and Validity.
The
Company has all requisite corporate power to execute and deliver, to perform
its
obligations under, and to consummate the transactions contemplated by, this
Agreement (subject to the approval of the Company Shareholders as contemplated
by Section 5.4 and to receipt of any consents, approvals, authorizations or
other matters referred to in Section 5.4). The execution and delivery by the
Company of, the performance by the Company of its obligations under, and the
consummation by the Company of the transactions contemplated by, this Agreement
have been duly authorized by all requisite action of the Company (subject to
the
approval of the Company Shareholders as contemplated by Section 5.4). This
Agreement has been duly executed and delivered by the Company and (assuming
due
execution and delivery by AMERICAN BUILDING COMPANY and approval by the Company
Shareholders) is the legal, valid, and binding obligation of the Company,
enforceable against it in accordance with its terms, except that such
enforcement may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to enforcement of
creditors’ rights generally and (ii) general equitable principles. Upon the
execution and delivery of the Collateral Documents by each Person (other than
by
AMERICAN BUILDING COMPANY) that is required by this Agreement to execute, or
that does execute, this Agreement or any of the Collateral Documents, and
assuming due execution and delivery thereof by AMERICAN BUILDING COMPANY, the
Collateral Documents will be the legal, valid and binding obligations of the
Company, enforceable against the Company in accordance with their respective
terms, except that such enforcement may be subject to (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting or
relating to enforcement of creditors’ rights generally and (ii) general
equitable principles.
3.4 No
Breach or Violation.
Subject
to obtaining the consents, approvals, authorizations, and orders of and making
the registrations or filings with or giving notices to Regulatory Authorities
and Persons identified herein, the execution, delivery and performance by the
Company of this Agreement and the Collateral Documents to which it is a party,
and the consummation of the transactions contemplated hereby and thereby in
accordance with the terms and conditions hereof and thereof, do not and will
not
conflict with, constitute a violation or breach of, constitute a default or
give
rise to any right of termination or acceleration of any right or obligation
of
the Company under, or result in the creation or imposition of any Encumbrance
upon the Company, the Company Assets, the Company Business or the Company Common
Stock by reason of the terms of (i) the articles of incorporation, by laws
or
other charter or organizational document of the Company or any Subsidiary of
the
Company, (ii) any material contract, agreement, lease, indenture or other
instrument to which the Company is a party or by or to which the Company, or
the
Assets may be bound or subject and a violation of which would result in a
Material Adverse Effect on the Company, (iii) any order, judgment, injunction,
award or decree of any arbitrator or Regulatory Authority or any statute, law,
rule or regulation applicable to the Company or (iv) any Permit of the Company,
which in the case of (ii), (iii) or (iv) above would have a Material Adverse
Effect on the Company or a material adverse effect on the validity, binding
effect or enforceability of this Agreement or the Collateral Documents or the
ability of the Company to perform its obligations under this Agreement or any
of
the Collateral Documents.
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3.5 Consents
and Approvals.
Except
for requirements described in Schedule 3.5, no consent, approval, authorization
or order of, registration or filing with, or notice to, any Regulatory Authority
or any other Person is necessary to be obtained, made or given by the Company
in
connection with the execution, delivery and performance by the Company of this
Agreement or any Collateral Document or for the consummation by the Company
of
the transactions contemplated hereby or thereby, except to the extent the
failure to obtain any such consent, approval, authorization or order or to
make
any such registration or filing would not have a Material Adverse Effect on
the
Company or a material adverse effect on the validity, binding effect or
enforceability of this Agreement or the Collateral Documents or the ability
of
the Company to perform its obligations under this Agreement or any of the
Collateral Documents.
3.6 Intellectual
Property.
To the
knowledge of the Company, the Company has good title to or the right to use
all
material company intellectual property rights and all material inventions,
processes, designs, formulae, trade secrets and know how necessary for the
operation of the Company Business without the payment of any royalty or similar
payment.
3.7 Compliance
with Legal Requirements.
The
Company has operated the Company Business in compliance with all Legal
Requirements applicable to the Company except to the extent the failure to
operate in compliance with all material Legal Requirements would not have a
Material Adverse Effect on the Company or Material Adverse Effect on the
validity, binding effect or enforceability of this Agreement or the Collateral
Documents.
3.8 Financial
Statements.
Prior
to the Closing Date the Company shall provide AMERICAN BUILDING COMPANY with
audited balance sheets of the Company as of December 31, 2006 and December
31,
2005 and statements of operations, stockholders’ equity and cash flows for the
years then ended,. Such financial statements (“Company Financial Statements”)
have or will have been prepared in accordance with U.S. generally accepted
accounting principles (“GAAP”) applied on a basis consistent throughout all
periods presented, present fairly in all material respects the financial
condition of the Company and its results of operations as of the date and for
the periods indicated.
3.9 Litigation.
Except
as set forth on Item 3.9 of the Disclosure Schedule, there are no outstanding
judgments or orders against or otherwise affecting or related to the Company,
the Company Business or the Company Assets and there is no action, suit,
complaint, proceeding or investigation, judicial, administrative or otherwise,
that is pending or, to the Company’s knowledge, threatened that, if adversely
determined, would have a Material Adverse Effect on the Company or a material
adverse effect on the validity, binding effect or enforceability of this
Agreement or the Collateral Documents, except as noted in the audited Company
Financial Statements or documented by the Company to AMERICAN BUILDING
COMPANY.
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3.10 Taxes.
The
Company has duly and timely filed in proper form all Tax Returns for all Taxes
required to be filed with the appropriate Regulatory Authority, and has paid
all
taxes required to be paid in respect thereof except where such failure would
not
have a Material Adverse Effect on the Company, except where, if not filed or
paid, the exception(s) have been documented by the Company to AMERICAN BUILDING
COMPANY.
3.11 Books
and Records.
The
books and records of the Company accurately and fairly represent the Company
Business and its results of operations in all material respects.
3.12 Brokers
or Finders.
Except
as set forth on Item 3.12 of the Disclosure Schedule, all negotiations relative
to this Agreement and the transactions contemplated hereby have been carried
out
by the Company or any of its Affiliates in connection with the transactions
contemplated by this Agreement, and with the exception of certain Investment
Banking fees, for which the Company is obligated, neither the Company, nor
any
of its Affiliates has incurred any obligation to pay any brokerage or finder’s
fee or other commission in connection with the transaction contemplated by
this
Agreement.
3.13 Proxies.
Company
management holds, or prior to the Closing will hold, irrevocable proxies from
the Company Shareholders adequate to ensure Company Shareholder approval of
the
Merger as required by applicable law.
3.14 Disclosure.
No
representation or warranty of the Company in this Agreement or in the Collateral
Documents and no statement in any certificate furnished or to be furnished
by
the Company pursuant to this Agreement contained, contains or will contain
on
the date such agreement or certificate was or is delivered, or on the Closing
Date, any untrue statement of a material fact, or omitted, omits or will omit
on
such date to state any material fact necessary in order to make the statements
made, in light of the circumstances under which they were made, not
misleading.
3.15 No
Undisclosed Liabilities.
Except
as set forth as Item 3.15 of the Company’s Disclosure Schedule, the Company is
not subject to any material liability (including unasserted claims), absolute
or
contingent, which is not shown or which is in excess of amounts shown or
reserved for in the audited balance sheet as of December 31, 2006, other than
liabilities of the same nature as those set forth in the Company Financial
Statements and reasonably incurred in the ordinary course of its business after
December 31, 2006.
3.16 Absence
of Certain Changes.
Except
as set forth as Item 3.16 of the Company’s Disclosure Schedule hereto, since
December 31, 2006, the Company has not: (a) suffered any material adverse change
in its financial condition, assets, liabilities or business; (b) contracted
for
or paid any capital expenditures; (c) incurred any indebtedness or borrowed
money, issued or sold any debt or equity securities, declared any dividends
or
discharged or incurred any liabilities or obligations except in the ordinary
course of business as heretofore conducted; (d) mortgaged, pledged or subjected
to any lien, lease, security interest or other charge or encumbrance any of
its
properties or assets; (e) paid any material amount on any indebtedness prior
to
the due date, forgiven or cancelled any material amount on any indebtedness
prior to the due date, forgiven or cancelled any material debts or claims or
released or waived any material rights or claims; (f) suffered any damage or
destruction to or loss of any assets (whether or not covered by insurance);
(g)
acquired or disposed of any assets or incurred any liabilities or obligations;
(h) made any payments to its affiliates or associates or loaned any money to
any
person or entity; (i) formed or acquired or disposed of any interest in any
corporation, partnership, limited liability company, joint venture or other
entity; (j) entered into any employment, compensation, consulting or collective
bargaining agreement or any other agreement of any kind or nature with any
person. or group, or modified or amended in any respect the terms of any such
existing agreement; (k) entered into any other commitment or transaction or
experience any other event that relates to or affect in any way this Agreement
or to the transactions contemplated hereby, or that has affected, or may
adversely affect the Company’s business, operations, assets, liabilities or
financial condition; or (1) amended its Articles of Organization or By-laws,
except as otherwise contemplated herein.
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3.17 Contracts.
Item
3.17 of the Company’s Disclosure Schedule is a true and complete list of all
contracts, agreements, leases, commitments or other understandings or
arrangements, written or oral, express or implied, to which the Company is
a
party or by which it or any of its property is bound or affected requiring
payments to or from, or incurring of liabilities by, the Company in excess
of
$1,000 (the “Contracts”). Except as set forth as Item 3.17 of the Company’s
Disclosure Schedule, the Company has complied with and performed, in all
material respects, all of its obligations required to be performed under and
is
not in default with respect to any of the Contracts, as of the date hereof,
nor
bas any event occurred which has not been cured which, with or without the
giving of notice, lapse of time, or both, would constitute a default in any
respect there under. To the best knowledge of the Company, no other party has
failed to comply with or perform, in all material respects, any of its
obligations required to be performed under or is in material default with
respect to any such Contracts, as of the date hereof, nor has any event occurred
which, with or without the giving of notice, lapse of time or both, would
constitute a material default in any respect by such party there under. Except
as set forth as Item 3.17 of the Company’s Disclosure Schedule, the Company
knows of and has no reason to believe that there are any facts or circumstances
which would make a material default by any party to any contract or obligation
likely to occur subsequent to the date hereof.
3.18 Permits
and Licenses.
The
Company has all certificates of occupancy, rights, permits, certificates,
licenses, franchises, approvals and other authorizations as are reasonably
necessary to conduct its business and to own, lease, use, operate and occupy
its
assets, at the places and in the manner now conducted and operated, except
those
the absence of which would not materially adversely affect its business. The
Company has not received any written or oral notice or claim pertaining to
the
failure to obtain any material permit, certificate, license, approval or other
authorization required by any federal, state or local agency or other regulatory
body, the failure of which to obtain would materially and adversely affect
its
business.
3.19 Assets
Necessary to Business.
The
Company owns or leases all properties and assets, real, personal, and mixed,
tangible and intangible, and is a party to all licenses, permits and other
agreements necessary to permit it to carry on its business as presently
conducted.
3.20 Labor
Agreements and Labor Relations.
Except
as set forth as Item 3.20 of the Company’s Disclosure Schedule hereto, the
Company has no collective bargaining or union contracts or agreements. Except
as
set forth as Item 3.20 of the Company’s Disclosure Schedule hereto, the Company
is in compliance with all applicable laws respecting employment and employment
practices, terms and conditions of employment and wages and hours, and is not
engaged in any unfair labor practices; there are no charges of discrimination
or
unfair labor practice charges” or complaints against the Company pending or
threatened before any governmental or regulatory agency or authority; and,
there
is no labor strike, dispute, slowdown or stoppage actually pending or threatened
against or affecting the Company.
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3.21 Employment
Arrangements.
Except
as set forth as Item 3.21 of the Company’s Disclosure Schedule hereto, the
Company has no employment or consulting agreements or arrangements, written
or
oral, which are not terminable at the will of the Company, or any pension,
profit-sharing, option, other incentive plan, or any other type of employment
benefit plan as defined in ERISA or otherwise, or any obligation to or customary
arrangement with employees for bonuses, incentive compensation, vacations,
severance pay, insurance or other benefits. No employee of the Company is in
violation of any employment agreement or restrictive covenant.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF AMERICAN BUILDING COMPANY
AMERICAN
BUILDING COMPANY represents and warrants to the Company that the statements
contained in this ARTICLE IV are correct and complete as of the date of this
Agreement and, except as provided in Section 8.1, will be correct and complete
as of the Closing Date (as though made then and as though the Closing Date
were
substituted for the date of this Agreement throughout this ARTICLE IV, except
in
the case of representations and warranties stated to be made as of the date
of
this Agreement or as of another date and except for changes contemplated or
permitted by the Agreement).
4.1 Organization
and Qualification.
AMERICAN BUILDING COMPANY is a corporation duly organized, validly existing
and
in good standing under the laws of Florida. AMERICAN BUILDING COMPANY has all
requisite power and authority to own, lease and use its assets as they are
currently owned, leased and used and to conduct its business as it is currently
conducted. AMERICAN BUILDING COMPANY is duly qualified or licensed to do
business in and are each in good standing in each jurisdiction in which the
character of the properties owned, leased or used by it or the nature of the
activities conducted by it makes such qualification necessary, except any such
jurisdiction where the failure to be so qualified or licensed and in good
standing would not have a Material Adverse Effect on AMERICAN BUILDING COMPANY
or a Material Adverse Effect on the validity, binding effect or enforceability
of this Agreement or the Collateral Documents or the ability of the Company
or
AMERICAN BUILDING COMPANY to perform its obligations under this Agreement or
any
of the Collateral Documents.
4.2 Capitalization.
(a) The
authorized capital stock of AMERICAN BUILDING COMPANY consists of One Million
shares of Common Stock (1,000,000), $0.01 par value, of which there are
---------------------one million shares issued and outstanding ----shares,
Preferred Stock (1,000,000), $0.01 par value, of which there are Zero (0) shares
issued and outstanding. The shares of AMERICAN BUILDING COMPANY Common Stock
included in the Merger Shares, when issued in accordance with this Agreement,
will have been duly authorized, validly issued and outstanding and will be
fully
paid and non-assessable, immediately upon execution hereon.
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(b) Schedule
4.2(b) lists all outstanding or authorized options, warrants, purchase rights,
preemptive rights or other contracts or commitments that could require AMERICAN
BUILDING COMPANY or any of its Subsidiaries to issue, sell, or otherwise cause
to become outstanding any of its capital stock or other ownership interests.
(c) All
of
the issued and outstanding shares of AMERICAN BUILDING COMPANY Capital Stock
have been duly authorized and are validly issued and outstanding, fully paid
and
nonassessable (with respect to Subsidiaries that are corporations) and have
been
issued in compliance with applicable securities laws and other applicable Legal
Requirements.
4.3 Authority
and Validity.
AMERICAN BUILDING COMPANY has all requisite power to execute and deliver, to
perform its obligations under, and to consummate the transactions contemplated
by, this Agreement and the Collateral Documents. The execution and delivery
by
AMERICAN BUILDING COMPANY of the performance of its obligations under, and
the
consummation by AMERICAN BUILDING COMPANY of the transactions contemplated
by,
this Agreement and the Collateral Documents have been duly authorized by all
requisite action of AMERICAN BUILDING COMPANY. This Agreement has been duly
executed and delivered by AMERICAN BUILDING COMPANY and (assuming due execution
and delivery by the Company) is the legal, valid and binding obligation of
AMERICAN BUILDING COMPANY, enforceable in accordance with its terms except
that
such enforcement may be subject to (i) bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting or relating to enforcement of
creditors’ rights generally and (ii) general equitable principles. Upon the
execution and delivery by AMERICAN BUILDING COMPANY of the Collateral Documents
to which each of them is a party, and assuming due execution and delivery
thereof by the other parties thereto, the Collateral Documents will be the
legal, valid and binding obligations of each such Person, as the case may be,
enforceable against each of them in accordance with their respective terms
except that such enforcement may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting or relating to
enforcement of creditors’ rights generally and (ii) general equitable
principles.
4.4 No
Breach or Violation.
Subject
to obtaining the consents, approvals, authorizations, and orders of and making
the registrations or filings with or giving notices to Regulatory Authorities
and Persons identified herein, the execution, delivery and performance by
AMERICAN BUILDING COMPANY of this Agreement and the Collateral Documents to
which each is a party and the consummation of the transactions contemplated
hereby and thereby in accordance with the terms and conditions hereof and
thereof, do not and will not conflict with, constitute a violation or breach
of,
constitute a default or give rise to any right of termination or acceleration
of
any right or obligation of AMERICAN BUILDING COMPANY under, or result in the
creation or imposition of any Encumbrance upon the property of AMERICAN BUILDING
COMPANY by reason of the terms of (i) the articles of incorporation, by laws
or
other charter or organizational document of AMERICAN BUILDING COMPANY, (ii)
any
contract, agreement, lease, indenture or other instrument to which AMERICAN
BUILDING COMPANY is a party or by or to which AMERICAN BUILDING COMPANY or
its
property may be bound or subject and a violation of which would result in a
Material Adverse Effect on AMERICAN BUILDING COMPANY taken as a whole, (iii)
any
order, judgment, injunction, award or decree of any arbitrator or Regulatory
Authority or any statute, law, rule or regulation applicable to AMERICAN
BUILDING COMPANY or (iv) any Permit of AMERICAN BUILDING COMPANY, which in
the
case of (ii), (iii) or (iv) above would have a Material Adverse Effect on
AMERICAN BUILDING COMPANY or a material adverse effect on the validity, binding
effect or enforceability of this Agreement or the Collateral Documents or the
ability of AMERICAN BUILDING COMPANY to perform its obligations hereunder or
there under.
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4.5 Consents
and Approvals.
Except
for requirements under applicable United States or state securities laws, no
consent, approval, authorization or order of, registration or filing with,
or
notice to, any Regulatory Authority or any other Person is necessary to be
obtained, made or given by AMERICAN BUILDING COMPANY in connection with the
execution, delivery and performance by them of this Agreement or any Collateral
Documents or for the consummation by them of the transactions contemplated
hereby or thereby, except to the extent the failure to obtain such consent,
approval, authorization or order or to make such registration or filings or
to
give such notice would not have a Material Adverse Effect on AMERICAN BUILDING
COMPANY or a material adverse effect on the validity, binding effect or
enforceability of this Agreement or the Collateral Documents or the ability
of
the Company or AMERICAN BUILDING COMPANY to perform its obligations under this
Agreement or any of the Collateral Documents.
4.6 Compliance
with Legal Requirements.
AMERICAN BUILDING COMPANY has operated the AMERICAN BUILDING COMPANY Business
in
compliance with all material Legal Requirements including, without limitation,
the Exchange Act and the Securities Act applicable to AMERICAN BUILDING COMPANY,
except to the extent the failure to operate in compliance with all material
Legal Requirements, would not have a Material Adverse Effect on AMERICAN
BUILDING COMPANY or a Material Adverse Effect on the validity, binding effect
or
enforceability of this Agreement or the Collateral Documents.
4.7 Litigation.
There
are no outstanding judgments or orders against or otherwise affecting or related
to AMERICAN BUILDING COMPANY, or their business or assets; and there is no
action, suit, complaint, proceeding or investigation, judicial, administrative
or otherwise, that is pending or, to the best knowledge of AMERICAN BUILDING
COMPANY, threatened that, if adversely determined, would have a Material Adverse
Effect on AMERICAN BUILDING COMPANY or a material adverse effect on the
validity, binding effect or enforceability of this Agreement or the Collateral
Documents.
4.8 Ordinary
Course.
Since
the date of the balance sheet included in the most recent AMERICAN BUILDING
COMPANY Securities Filings filed through the date hereof, there has not been
any
occurrence, event, incident, action, failure to act or transaction involving
AMERICAN BUILDING COMPANY which is reasonably likely, individually or in the
aggregate, to have a Material Adverse Effect on AMERICAN BUILDING
COMPANY.
4.9 Assets
and Liabilities.
As of
the date of this Agreement, neither AMERICAN BUILDING COMPANY nor any of its
Subsidiaries has any Assets or Liability, except for the (i) Assets and
Liabilities disclosed in the balance sheet included in the most recent AMERICAN
BUILDING COMPANY Securities Filings filed through the date hereof or disclosed
on Schedule 4.9 and (ii) Liabilities incurred in connection with this
Agreement.
4.10 Taxes.
AMERICAN BUILDING COMPANY has, and each of its Subsidiaries has, duly and timely
filed in proper form all Tax Returns for all Taxes required to be filed with
the
appropriate Governmental Authority, except where such failure to file would
not
have a Material Adverse Effect on AMERICAN BUILDING COMPANY.
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4.11 Books
and Records.
The
books and records of AMERICAN BUILDING COMPANY and its Subsidiaries accurately
and fairly represent the AMERICAN BUILDING COMPANY Business and its results
of
operations in all material respects. All accounts receivable and inventory
of
the AMERICAN BUILDING COMPANY Business are reflected properly on such books
and
records in all material respects.
4.12 Financial
and Other Information.
(a) The
historical financial statements (including the notes thereto) contained (or
incorporated by reference) in the AMERICAN BUILDING COMPANY Securities Filings
have been prepared in accordance with GAAP applied on a consistent basis
throughout the periods covered thereby (except as may be indicated in the notes
thereto), and present fairly the financial condition of AMERICAN BUILDING
COMPANY and its results of operations as of the dates and for the periods
indicated, subject in the case of the unaudited financial statements only to
normal year end adjustments (none of which will be material in amount) and
the
omission of footnotes.
(b) To
the
knowledge of current management, the AMERICAN BUILDING COMPANY Securities
Filings did not, as of their filing dates, contain (directly or by incorporation
by reference) any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein (or incorporated therein by reference), in light of the circumstances
under which they were or will be made, not misleading.
4.13 Brokers
or Finders.
Except
as set forth in Item 4.13 of the Disclosure Schedule, no broker or finder has
acted directly or indirectly for AMERICAN BUILDING COMPANY in connection with
the transactions contemplated by this Agreement, and AMERICAN BUILDING COMPANY
has not incurred any obligation to pay any brokerage or finder’s fee or other
commission in connection with the transaction contemplated by this
Agreement.
4.14 Disclosure.
No
representation or warranty of AMERICAN BUILDING COMPANY in this Agreement or
in
the Collateral Documents and no statement in any certificate furnished or to
be
furnished by AMERICAN BUILDING COMPANY pursuant to this Agreement contained,
contains or will contain on the date such agreement or certificate was or is
delivered, or on the Closing Date, any untrue statement of a material fact,
or
omitted, omits or will omit on such date to state any material fact necessary
in
order to make the statements made, in light of the circumstances under which
they were made, not misleading.
4.15 Filings.
AMERICAN BUILDING COMPANY has made all of the filings required by the Securities
Act of 1933, as amended, and the Exchange Act of 1934, as amended, required
to
be made and no such filing contains any untrue statement of a material fact
or
omits to state a material fact necessary to make the statements made, not
misleading.
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4.16 Conduct
of Business.
Prior
to the Closing Date, the Company shall conduct its business in the normal
course, and shall not sell, pledge, or assign any assets, without the prior
written approval of AMERICAN BUILDING COMPANY, except in the regular course
of
business. Except as otherwise provided herein, the Company shall not amend
its
Articles of Incorporation or By-Laws, declare dividends, redeem or sell stock
or
other securities, acquire or dispose of fixed assets, change employment terms,
enter into any material or long-term contract, guarantee obligations of any
third party, settle or discharge any material balance sheet receivable for
less
than its stated amount, pay more on any liability than its stated amount or
enter into any other transaction other than in the regular course of
business.
ARTICLE
V
COVENANTS
OF THE COMPANY
Between
the date of this Agreement and the Closing Date:
5.1 Additional
Information.
The
Company shall provide to AMERICAN BUILDING COMPANY and its Representatives
such
financial, operating and other documents, data and information relating to
the
Company, the Company Business and the Company Assets and Liabilities of the
Company, as AMERICAN BUILDING COMPANY or its Representatives may reasonably
request. In addition, the Company shall take all action necessary to enable
AMERICAN BUILDING COMPANY and its Representatives to review, inspect and audit
the Company Assets, the Company Business and Liabilities of the Company and
discuss them with the Company’s officers, employees, independent accountants,
customers, licensees, and counsel. Notwithstanding any investigation that
AMERICAN BUILDING COMPANY may conduct of the Company, the Company Business,
the
Company Assets and the Liabilities of the Company, AMERICAN BUILDING COMPANY
may
fully rely on the Company’s warranties, covenants and indemnities set forth in
this Agreement.
5.2 Consents
and Approvals.
As soon
as practicable after execution of this Agreement, the Company shall use
commercially reasonable efforts to obtain any necessary consent, approval,
authorization or order of, make any registration or filing with or give any
notice to, any Regulatory Authority or Person as is required to be obtained,
made or given by the Company to consummate the transactions contemplated by
this
Agreement and the Collateral Documents.
5.3 Non-circumvention.
It is
understood that in connection with the transactions contemplated hereby,
AMERICAN BUILDING COMPANY has been and will be seeking to find investors willing
to provide loans and/or capital investments to finance business plans. In
connection therewith, the Company will not, and it will cause its directors,
officers, employees, agents and representatives not to attempt, directly or
indirectly, (i) to contact any party introduced to it by AMERICAN BUILDING
COMPANY, or (ii) deal with, or otherwise become involved in any transaction
with
any party which has been introduced to it by AMERICAN BUILDING COMPANY, without
the express written permission of the introducing party and without having
entered into a commission agreement with the introducing party. Any violation
of
the covenant shall be deemed an attempt to circumvent AMERICAN BUILDING COMPANY,
and the party so violating this covenant shall be liable for damages in favor
of
the circumvented party.
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5.4 No
Solicitations.
From
and after the date of this Agreement until the Effective Time or termination
of
this Agreement pursuant to ARTICLE X, the Company will not nor will it authorize
or permit any of its officers, directors, affiliates or employees or any
investment banker, attorney or other advisor or representative retained by
it,
directly or indirectly, (i) solicit or initiate the making, submission or
announcement of any other acquisition proposal, (ii) participate in any
discussions or negotiations regarding, or furnish to any person any non public
information with respect to any other acquisition proposal, (iii) engage in
discussions with any Person with respect to any other acquisition proposal,
except as to the existence of these provisions, (iv) approve, endorse or
recommend any other acquisition proposal or (v) enter into any letter of intent
or similar document or any contract agreement or commitment contemplating or
otherwise relating to any other acquisition proposal.
5.5 Notification
of Adverse Change.
The
Company shall promptly notify AMERICAN BUILDING COMPANY of any material adverse
change in the condition (financial or otherwise) of the Company.
5.6 Meeting
of the Company Shareholders.
Promptly after the date hereof, if required under applicable law, the Company
will take all action necessary in accordance with its articles of incorporation
and by-laws to convene a meeting of the Company’s shareholders to consider the
adoption and approval of this Agreement and approval of the Merger to be held
as
promptly as practicable. The Company will use its reasonable efforts to solicit
from its shareholders proxies in favor of the adoption and approval of this
Agreement and the approval of the Merger and will take all other action
necessary or advisable to secure the vote or consent of its shareholders
required by the DCC to obtain such approvals. In lieu of such meeting, the
adoption and approval of this Agreement and the Merger may be approved by
shareholder consent.
5.7 Notification
of Certain Matters.
The
Company shall promptly notify AMERICAN BUILDING COMPANY of any fact, event,
circumstance or action known to it that is reasonably likely to cause the
Company to be unable to perform any of its covenants contained herein or any
condition precedent in ARTICLE VII not to be satisfied, or that, if known on
the
date of this Agreement, would have been required to be disclosed to AMERICAN
BUILDING COMPANY pursuant to this Agreement or the existence or occurrence
of
which would cause any of the Company’s representations or warranties under this
Agreement not to be correct and/or complete. The Company shall give prompt
written notice to AMERICAN BUILDING COMPANY of any adverse development causing
a
breach of any of the representations and warranties in ARTICLE III as of the
date made.
5.8 Company
Disclosure Schedule.
The
Company shall, from time to time prior to Closing, supplement the Company
Disclosure Statement with additional information that, if existing or known
to
it on the date of delivery to AMERICAN BUILDING COMPANY, would have been
required to be included therein. For purposes of determining the satisfaction
of
any of the conditions to the obligations of AMERICAN BUILDING COMPANY in ARTICLE
VII, the Company Disclosure Statement shall be deemed to include only (a) the
information contained therein on the date of this Agreement and (b) information
added to the Company Disclosure Statement by written supplements delivered
prior
to Closing by the Company that (i) are accepted in writing by AMERICAN BUILDING
COMPANY, or (ii) reflect actions taken or events occurring after the date hereof
prior to Closing.
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5.9 State
Statutes.
The
Company and its Board of Directors shall, if any state takeover statute or
similar law is or becomes applicable to the Merger, this Agreement or any of
the
transactions contemplated by this Agreement, use all reasonable efforts to
ensure that the Merger and the other transactions contemplated by this Agreement
may be consummated as promptly as practicable on the terms contemplated by
this
Agreement and otherwise to minimize the effect of such statute or regulation
on
the Merger, this Agreement and the transactions contemplated
hereby.
5.10 Conduct
of Business.
Prior
to the Closing Date, the Company shall conduct its business in the normal
course, and shall not sell, pledge, or assign any assets, without the prior
written approval of AMERICAN BUILDING COMPANY, except in the regular course
of
business. Except as otherwise provided herein, the Company shall not amend
its
Articles of Incorporation or Bylaws, declare dividends, redeem or sell stock
or
other securities, acquire or dispose of fixed assets, change employment terms,
enter into any material or long-term contract, guarantee obligations of any
third party, settle or discharge any material balance sheet receivable for
less
than its stated amount, pay more on any liability than its stated amount, or
enter into any other transaction other than in the regular course of
business.
ARTICLE
VI
COVENANTS
OF AMERICAN BUILDING COMPANY
Between
the date of this Agreement and the Closing Date,
6.1 Additional
Information.
AMERICAN BUILDING COMPANY shall provide to the Company and its Representatives
such financial, operating and other documents, data and information relating
to
AMERICAN BUILDING COMPANY, the AMERICAN BUILDING COMPANY Business and the
AMERICAN BUILDING COMPANY Assets and the Liabilities of AMERICAN BUILDING
COMPANY and its Subsidiaries, as the Company or its Representatives may
reasonably request. In addition, the Company shall take all action necessary
to
enable the Company and its Representatives to review and inspect the AMERICAN
BUILDING COMPANY Assets, the AMERICAN BUILDING COMPANY Business and the
Liabilities of AMERICAN BUILDING COMPANY and discuss them with the Company’s
officers, employees, independent accountants and counsel. Notwithstanding any
investigation that the Company may conduct of AMERICAN BUILDING COMPANY, the
AMERICAN BUILDING COMPANY Business, the AMERICAN BUILDING COMPANY Assets and
the
Liabilities of AMERICAN BUILDING COMPANY, the Company may fully rely on AMERICAN
BUILDING COMPANY’s warranties, covenants and indemnities set forth in this
Agreement.
6.2 No
Solicitations.
From
and after the date of this Agreement until the Effective Time or termination
of
this Agreement pursuant to ARTICLE X, AMERICAN BUILDING COMPANY will not nor
will it authorize or permit any of its officers, directors, affiliates or
employees or any investment banker, attorney or other advisor or representative
retained by it, directly or indirectly, (i) solicit or initiate the making,
submission or announcement of any other acquisition proposal, (ii) participate
in any discussions or negotiations regarding, or furnish to any person any
non
public information with respect to any other acquisition proposal, (iii) engage
in discussions with any Person with respect to any other acquisition proposal,
except as to the existence of these provisions, (iv) approve, endorse or
recommend any other acquisition proposal or (v) enter into any letter of intent
or similar document or any contract agreement or commitment contemplating or
otherwise relating to any other acquisition proposal.
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21
6.3 Notification
of Adverse Change.
AMERICAN BUILDING COMPANY shall promptly notify the Company of any material
adverse change in the condition (financial or otherwise) of AMERICAN BUILDING
COMPANY.
6.4 Consents
and Approvals.
As soon
as practicable after execution of this Agreement, AMERICAN BUILDING COMPANY
shall use its commercially reasonable efforts to obtain any necessary consent,
approval, authorization or order of, make any registration or filing with or
give notice to, any Regulatory Authority or Person as is required to be
obtained, made or given by AMERICAN BUILDING COMPANY to consummate the
transactions contemplated by this Agreement and the Collateral Documents.
6.5 Notification
of Certain Matters.
AMERICAN BUILDING COMPANY shall promptly notify the Company of any fact, event,
circumstance or action known to it that is reasonably likely to cause AMERICAN
BUILDING COMPANY to be unable to perform any of its covenants contained herein
or any condition precedent in 0 not to be satisfied, or that, if known on the
date of this Agreement, would have been required to be disclosed to the Company
pursuant to this Agreement or the existence or occurrence of which would cause
AMERICAN BUILDING COMPANY’s representations or warranties under this Agreement
not to be correct and/or complete. AMERICAN BUILDING COMPANY shall give prompt
written notice to the Company of any adverse development causing a breach of
any
of the representations and warranties in ARTICLE IV.
6.6 AMERICAN
BUILDING COMPANY Disclosure Schedule.
AMERICAN BUILDING COMPANY shall, from time to time prior to Closing, supplement
the AMERICAN BUILDING COMPANY Disclosure Statement with additional information
that, if existing or known to it on the date of this Agreement, would have
been
required to be included therein. For purposes of determining the satisfaction
of
any of the conditions to the obligations of the Company in 0, the AMERICAN
BUILDING COMPANY Disclosure Statement shall be deemed to include only (a) the
information contained therein on the date of delivery to the Company and (b)
information added to the AMERICAN BUILDING COMPANY Disclosure Statement by
written supplements delivered prior to Closing by AMERICAN BUILDING COMPANY
that
(i) are accepted in writing by the Company or (ii) reflect actions taken or
events occurring after the date hereof and prior to Closing.
6.7 Securities
Filings.
AMERICAN BUILDING COMPANY will timely file all reports and other documents
relating to the operation of AMERICAN BUILDING COMPANY required to be filed
with
the Securities and Exchange Commission, which reports and other documents do
not
and will not contain any misstatement of a material fact, and do not and will
not omit any material fact necessary to make the statements therein not
misleading.
6.8 Election
to AMERICAN BUILDING COMPANY’s Board of Directors.
At the
Effective Time of the Merger, AMERICAN BUILDING COMPANY shall take all steps
necessary so that there will be a one (1) continuing director (the “AMERICAN
BUILDING COMPANY Director”) and the remaining directors designated by the
Company.
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ARTICLE
VII
CONDITIONS
PRECEDENT TO OBLIGATIONS OF AMERICAN BUILDING COMPANY
All
obligations of the AMERICAN BUILDING COMPANY Parties under this Agreement shall
be subject to the fulfillment at or prior to Closing of each of the following
conditions, it being understood that AMERICAN BUILDING COMPANY may, in their
sole discretion, to the extent permitted by applicable Legal Requirements,
waive
any or all of such conditions in whole or in part.
7.1 Accuracy
of Representations.
All
representations and warranties of the Company contained in this Agreement,
the
Collateral Documents and any certificate delivered by any of the Company at
or
prior to Closing shall be, if specifically qualified by materiality, true in
all
respects and, if not so qualified, shall be true in all material respects,
in
each case on and as of the Closing Date with the same effect as if made on
and
as of the Closing Date, except for representations and warranties expressly
stated to be made as of the date of this Agreement or as of another date other
than the Closing Date and except for changes contemplated or permitted by this
Agreement. The Company shall have delivered to AMERICAN BUILDING COMPANY a
certificate dated the Closing Date to the foregoing effect.
7.2 Covenants.
The
Company shall, in all material respects, have performed and complied with each
of the covenants, obligations and agreements contained in this Agreement and
the
Collateral Documents that are to be performed or complied with by them at or
prior to Closing. The Company shall have delivered to AMERICAN BUILDING COMPANY
a certificate dated the Closing Date to the foregoing effect.
7.3 Consents
and Approvals.
All
consents, approvals, permits, authorizations and orders required to be obtained
from, and all registrations, filings and notices required to be made with or
given to, any Regulatory Authority or Person as provided herein.
7.4 Delivery
of Documents.
The
Company shall have delivered, or caused to be delivered, to AMERICAN BUILDING
COMPANY the following documents:
(i) Certified
copies of the Company articles of incorporation and by laws and certified
resolutions of the board of directors and Shareholders of the Company
authorizing the execution of this Agreement and the Collateral Documents to
which it is a party and the consummation of the transactions contemplated hereby
and thereby.
(ii) Such
other documents and instruments as AMERICAN BUILDING COMPANY may reasonably
request: (A) to evidence the accuracy of the Company’s representations and
warranties under this Agreement, the Collateral Documents and any documents,
instruments or certificates required to be delivered hereunder; (B) to evidence
the performance by the Company of, or the compliance by the Company with, any
covenant, obligation, condition and agreement to be performed or complied with
by the Company under this Agreement and the Collateral Documents; or (C) to
otherwise facilitate the consummation or performance of any of the transactions
contemplated by this Agreement and the Collateral Documents.
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23
7.5 No
Material Adverse Change.
Since
the date hereof, there shall have been no material adverse change in the Company
Assets, the Company Business or the financial condition or operations of the
Company, taken as a whole.
ARTICLE
VIII
CONDITIONS
PRECEDENT TO OBLIGATIONS OF THE COMPANY
All
obligations of the Company under this Agreement shall be subject to the
fulfillment at or prior to Closing of the following conditions, it being
understood that the Company may, in its sole discretion, to the extent permitted
by applicable Legal Requirements, waive any or all of such conditions in whole
or in part.
8.1 Accuracy
of Representations.
All
representations and warranties of AMERICAN BUILDING COMPANY contained in this
Agreement and the Collateral Documents and any other document, instrument or
certificate delivered by any of AMERICAN BUILDING COMPANY at or prior to the
Closing shall be, if specifically qualified by materiality, true and correct
in
all respects and, if not so qualified, shall be true and correct in all material
respects, in each case on and as of the Closing Date with the same effect as
if
made on and as of the Closing Date, except for representations and warranties
expressly stated to be made as of the date of this Agreement or as of another
date other than the Closing Date and except for changes contemplated or
permitted by this Agreement. AMERICAN BUILDING COMPANY shall have delivered
to
the Company a certificate dated the Closing Date to the foregoing
effect.
8.2 Covenants.
AMERICAN BUILDING COMPANY shall, in all material respects, have performed and
complied with each obligation, agreement, covenant and condition contained
in
this Agreement and the Collateral Documents and required by this Agreement
and
the Collateral Documents to be performed or complied with by AMERICAN BUILDING
COMPANY at or prior to Closing. AMERICAN BUILDING COMPANY shall have delivered
to the Company a certificate dated the Closing Date to the foregoing
effect.
8.3 Consents
and Approvals.
All
consents; approvals, authorizations and orders required to be obtained from,
and
all registrations, filings and notices required to be made with or given to,
any
Regulatory Authority or Person as provided herein.
8.4 Delivery
of Documents.
AMERICAN BUILDING COMPANY, as applicable, shall have executed and delivered,
or
caused to be executed and delivered, to the Company the following
documents:
(i) Certified
copies of the articles of incorporation and by laws of AMERICAN BUILDING COMPANY
and certified resolutions by the board of directors authorizing the execution
of
this Agreement and the Collateral Documents and the consummation of the
transactions contemplated hereby.
(ii) Such
other documents and instruments as the Company may reasonably request: (A)
to
evidence the accuracy of the representations and warranties of AMERICAN BUILDING
COMPANY under this Agreement and the Collateral Documents and any documents,
instruments or certificates required to be delivered hereunder; (B) to evidence
the performance by AMERICAN BUILDING COMPANY of, or the compliance by AMERICAN
BUILDING COMPANY with, any covenant, obligation, condition and agreement to
be
performed or complied with by AMERICAN BUILDING COMPANY under this Agreement
and
the Collateral Documents; or (C) to otherwise facilitate the consummation or
performance of any of the transactions contemplated by this Agreement and the
Collateral Documents, including:
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24
(iii) Letters
of resignation from AMERICAN BUILDING COMPANY’s current officers and, as
provided in Section 6.8, directors to be effective upon the
Closing.
(iv) Board
resolutions from AMERICAN BUILDING COMPANY’s current directors appointing the
designees of the Company to AMERICAN BUILDING COMPANY’s board of
directors.
8.5 No
Material Adverse Change.
There
shall have been no material adverse change in the business, financial condition
or operations of AMERICAN BUILDING COMPANY and its Subsidiaries taken as a
whole.
8.6 No
Litigation.
No
action, suit or proceeding shall be pending or threatened by or before any
Regulatory Authority and no Legal Requirement shall have been enacted,
promulgated or issued or deemed applicable to any of the transactions
contemplated by this Agreement and the Collateral Documents that would: (i)
prevent consummation of any of the transactions contemplated by this Agreement
and the Collateral Documents; (ii) cause any of the transactions contemplated
by
this Agreement and the Collateral Documents to be rescinded following
consummation; or (iii) have a Material Adverse Effect on AMERICAN BUILDING
COMPANY.
8.7 No
Assets & Liabilities.
AMERICAN BUILDING COMPANY shall have no assets other than cash nor
liabilities.
8.8 Exchange
Act Requirements.
AMERICAN BUILDING COMPANY shall have complied with the provisions of Rule 14f-1
of the Exchange Act, if necessary and shall be current in all of its securities
filings.
8.9 Dissenters’
Rights.
Not
more than $25,000 in claims shall have been asserted in connection with
dissenters’ approval rights under the DCC in connection with the
Merger.
8.10 Reverse
Split -
AMERICAN BUILDING COMPANY will have effected a reverse split of
16.2.
Shareholders,
Debt Conversion Shareholder shall have entered into a Leakage Agreement with
AMERICAN BUILDING COMPANY acceptable to Company.
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25
ARTICLE
IX
INDEMNIFICATION
9.1 Indemnification
by the Company.
The
Company shall indemnify, defend and hold harmless (i) AMERICAN BUILDING COMPANY,
(ii) each of AMERICAN BUILDING COMPANY’s assigns and successors in interest to
the Company Shares, and (iii) each of their respective shareholders, members,
partners, directors, officers, managers, employees, agents, attorneys and
representatives, from and against any and all Losses which may be incurred
or
suffered by any such party and which may arise out of or result from any breach
of any material representation, warranty, covenant or agreement of the Company
contained in this Agreement. All claims to be assorted hereunder must be made
for the first anniversary of the Closing.
9.2 Indemnification
by the AMERICAN BUILDING COMPANY Parties.
The
AMERICAN BUILDING COMPANY Parties shall indemnify, defend and hold harmless
the
Company and each of the Company Shareholders from and against any and all Losses
which may be incurred or suffered by any such party hereto and which may arise
out of or result from any breach of any material representation, warranty,
covenant or agreement of the AMERICAN BUILDING COMPANY Parties contained in
this
Agreement. All claims to be assorted hereunder must be made for the first
anniversary of the Closing.
9.3 Notice
to Indemnifying Party.
If any
party (the “Indemnified Party”) receives notice of any claim or other
commencement of any action or proceeding with respect to which any other party
(or parties) (the “Indemnifying Party”) is obligated to provide indemnification
pursuant to Sections 9.1 or 9.2, the Indemnified Party shall promptly give
the
Indemnifying Party written notice thereof, which notice shall specify in
reasonable detail, if known, the amount or an estimate of the amount of the
liability arising here from and the basis of the claim. Such notice shall be
a
condition precedent to any liability of the Indemnifying Party for
indemnification hereunder, but the failure of the Indemnified Party to give
prompt notice of a claim shall not adversely affect the Indemnified Party’s
right to indemnification hereunder unless the defense of that claim is
materially prejudiced by such failure. The Indemnified Party shall not settle
or
compromise any claim by a third party for which it is entitled to
indemnification hereunder without the prior written consent of the Indemnifying
Party (which shall not be unreasonably withheld or delayed) unless suit shall
have been instituted against it and the Indemnifying Party shall not have taken
control of such suit after notification thereof as provided in Section
9.4.
9.4 Defense
by Indemnifying Party.
In
connection with any claim giving rise to indemnity hereunder resulting from
or
arising out of any claim or legal proceeding by a Person who is not a party
to
this Agreement, the Indemnifying Party at its sole cost and expense may, upon
written notice to the Indemnified Party, assume the defense of any such claim
or
legal proceeding (i) if it acknowledges to the Indemnified Party in writing
its
obligations to indemnify the Indemnified Party with respect to all elements
of
such claim (subject to any limitations on such liability contained in this
Agreement) and (ii) if it provides assurances, reasonably satisfactory to the
Indemnified Party, that it will be financially able to satisfy such claims
in
full if the same are decided adversely. If the Indemnifying Party assumes the
defense of any such claim or legal proceeding, it may use counsel of its choice
to prosecute such defense, subject to the approval of such counsel by the
Indemnified Party, which approval shall not be unreasonably withheld or delayed.
The Indemnified Party shall be entitled to participate in (but not control)
the
defense of any such action, with its counsel and at its own expense; provided,
however, that if the Indemnified Party, in its sole discretion, determines
that
there exists a conflict of interest between the Indemnifying Party (or any
constituent party thereof) and the Indemnified Party, the Indemnified Party
(or
any constituent party thereof) shall have the right to engage separate counsel,
the reasonable costs and expenses of which shall be paid by the Indemnified
Party. If the Indemnifying Party assumes the defense of any such claim or legal
proceeding, the Indemnifying Party shall take all steps necessary to pursue
the
resolution thereof in a prompt and diligent manner. The Indemnifying Party
shall
be entitled to consent to a settlement of, or the stipulation of any judgment
arising from, any such claim or legal proceeding, with the consent of the
Indemnified Party, which consent shall not be unreasonably withheld or delayed;
provided, however, that no such consent shall be required from the Indemnified
Party if (i) the Indemnifying Party pays or causes to be paid all Losses arising
out of such settlement or judgment concurrently with the effectiveness thereof
(as well as all other Losses theretofore incurred by the Indemnified Party
which
then remain unpaid or unreimbursed), (ii) in the case of a settlement, the
settlement is conditioned upon a complete release by the claimant of the
Indemnified Party and (iii) such settlement or judgment does not require the
encumbrance of any asset of the Indemnified Party or impose any restriction
upon
its conduct of business.
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ARTICLE
X
TERMINATION
10.1 Termination.
This
Agreement may be terminated, and the transactions contemplated hereby may be
abandoned, at any time prior to the Effective Time.
(a) by
mutual
written agreement of AMERICAN BUILDING COMPANY and the Company hereto duly
authorized by action taken by or on behalf of their respective Boards of
Directors; or
(b) by
either
the Company or AMERICAN BUILDING COMPANY upon notification to the non
terminating party by the terminating party:
(i) if
the
terminating party is not in material breach of its obligations under this
Agreement and there has been a material breach of any representation, warranty,
covenant or agreement on the part of the non terminating party set forth in
this
Agreement such that the conditions in Sections 7.1, 7.2, 8.1 or 8.2 will not
be
satisfied; provided, however, that if such breach is curable by the non
terminating party and such cure is reasonably likely to be completed prior
to
the date specified in Section 10.1(b)(i), then, for so long as the non
terminating party continues to use commercially reasonable efforts to effect
and
cure, the terminating party may not terminate pursuant to this Section
10.1(b)(i);
(ii) if
the
Closing has not transpired on or before November 30, 2007.
(iii) if
any
court of competent jurisdiction or other competent Governmental or Regulatory
Authority shall have issued an order making illegal or otherwise permanently
restricting, preventing or otherwise prohibiting the Merger and such order
shall
have become final; or
10.2 Effect
of Termination.
If this
Agreement is validly terminated by either the Company or AMERICAN BUILDING
COMPANY pursuant to Section 10.1, this Agreement will forthwith become null
and
void and there will be no liability or obligation on the part of the parties
hereto, except that nothing contained herein shall relieve any party hereto
from
liability for willful breach of its representations, warranties, covenants
or
agreements contained in this Agreement.
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ARTICLE
XI
MISCELLANEOUS
11.1 Parties
Obligated and Benefited.
This
Agreement shall be binding upon the Parties and their respective successors
by
operation of law and shall inure solely to the benefit of the Parties and their
respective successors by operation of law, and no other Person shall be entitled
to any of the benefits conferred by this Agreement, except that the Company
Shareholders shall be third party beneficiaries of this Agreement. Without
the
prior written consent of the other Party, no Party may assign this Agreement
or
the Collateral Documents or any of its rights or interests or delegate any
of
its duties under this Agreement or the Collateral Documents.
11.2 Publicity.
The
initial press release shall be a joint press release and thereafter the Company
and AMERICAN BUILDING COMPANY each shall consult with each other prior to
issuing any press releases or otherwise making public announcements with respect
to the Merger and the other transactions contemplated by this Agreement and
prior to making any filings with any third party and/or any Regulatory
Authorities (including any national securities inter dealer quotation service)
with respect thereto, except as may be required by law or by obligations
pursuant to any listing agreement with or rules of any national securities
inter
dealer quotation service.
11.3 Notices.
Any
notices and other communications required or permitted hereunder shall be in
writing and shall be effective upon delivery by hand or upon receipt if sent
by
certified or registered mail (postage prepaid and return receipt requested)
or
by a nationally recognized overnight courier service (appropriately marked
for
overnight delivery) or upon transmission if sent by telex or facsimile (with
request for immediate confirmation of receipt in a manner customary for
communications of such respective type and with physical delivery of the
communication being made by one or the other means specified in this Section
as
promptly as practicable thereafter). Notices shall be addressed as
follows:
If
to
AMERICAN
BUILDING
COMPANY
to:
|
|
|
American
Building Company Industries, Inc.
00000
Xxx Xxxxx Xxx. Xxx 000
Xxx
Xxxxxxx, Xx 00000
Facsimile
No: 000-000-0000
|
If
to the Company to:
|
|
|
Verbena
Pharmaceuticals, Inc.
000
Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxx, 00000
Attention:
Xxxxx Xxxxxx
Facsimile
No:
|
|
With
a copy to:
|
Any
Party
may change the address to which notices are required to be sent by giving notice
of such change in the manner provided in this Section.
11.4 Attorneys’
Fees.
In the
event of any action or suit based upon or arising out of any alleged breach
by
any Party of any representation, warranty, covenant or agreement contained
in
this Agreement or the Collateral Documents, the prevailing Party shall be
entitled to recover reasonable attorneys’ fees and other costs of such action or
suit from the other Party.
11.5 Headings.
The
Article and Section headings of this Agreement are for convenience only and
shall not constitute a part of this Agreement or in any way affect the meaning
or interpretation thereof.
11.6 Choice
of Law.
This
Agreement and the rights of the Parties under it shall be governed by and
construed in all respects in accordance with the laws of the State of Delaware,
without giving effect to any choice of law provision or rule (whether of the
State of Delaware or any other jurisdiction that would cause the application
of
the laws of any jurisdiction other than the State of Delaware).
11.7 Rights
Cumulative.
All
rights and remedies of each of the Parties under this Agreement shall be
cumulative, and the exercise of one or more rights or remedies shall not
preclude the exercise of any other right or remedy available under this
Agreement or applicable law.
11.8 Further
Actions.
The
Parties shall execute and deliver to each other, from time to time at or after
Closing, for no additional consideration and at no additional cost to the
requesting party, such further assignments, certificates, instruments, records,
or other documents, assurances or things as may be reasonably necessary to
give
full effect to this Agreement and to allow each party fully to enjoy and
exercise the rights accorded and acquired by it under this
Agreement.
11.9 Time
of the Essence.
Time is
of the essence under this Agreement. If the last day permitted for the giving
of
any notice or the performance of any act required or permitted under this
Agreement falls on a day which is not a Business Day, the time for the giving
of
such notice or the performance of such act shall be extended to the next
succeeding Business Day.
11.10 Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
instrument.
11.11 Entire
Agreement.
This
Agreement (including the Exhibits, the Company Disclosure Statement, the
AMERICAN BUILDING COMPANY Disclosure Statement and any other documents,
instruments and certificates referred to herein, which are incorporated in
and
constitute a part of this Agreement) contains the entire agreement of the
Parties.
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28
11.12 Survival
of Representations and Covenants.
Notwithstanding any right of AMERICAN BUILDING COMPANY to fully investigate
the
affairs of the Company and notwithstanding any knowledge of facts determined
or
determinable by AMERICAN BUILDING COMPANY pursuant to such investigation or
right of investigation, AMERICAN BUILDING COMPANY shall have the right to rely
fully upon the representations, warranties, covenants and agreements of the
Company contained in this Agreement. Each representation, warranty, covenant
and
agreement of the Company contained herein shall survive the execution and
delivery of this Agreement and the Closing and shall thereafter terminate and
expire on the first anniversary of the Closing Date unless, prior to such date,
AMERICAN BUILDING COMPANY has delivered to the Company Shareholders a written
notice of a claim with respect to such representation, warranty, covenant or
agreement.
IN
WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of
the
day and year first above written.
Dated: ___________________,
2007
|
American
Building Company Industries, Inc.,
a
Florida Corporation
By:________________________________
Name:
Title: Chief
Executive Officer
|
Dated: ___________________,
2007
|
Verbena
Pharmaceuticals, Inc.,
a
Delaware Corporation
By:________________________________
Name:
Title: Chief
Executive Officer
|
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