Exhibit 2.1
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (hereinafter referred to as the "Agreement") by and
between Indigo Land and Development, Inc., a Virginia corporation (hereinafter
referred to as "Indigo"), Procare America, Inc., a Nevada corporation
(hereinafter referred to as "Procare"), and the shareholders of record of Indigo
Land and Development, Inc. (hereinafter referred to as "Shareholders"), was
entered into on the 15th day of December, 2005.
WITNESSETH
WHEREAS, Shareholders are the owner of all of the issued and outstanding
shares of the capital stock of Indigo, and
WHEREAS, pursuant to this Agreement, Procare desires to exchange and
acquire from the Shareholders and the Shareholders desire to exchange and convey
to Procare, all of the issued and outstanding shares of the capital stock of
Indigo (referred to as the "Stock") upon the terms and conditions and for the
consideration hereinafter set forth, including stock sale agreements by and
between ▇▇▇▇▇ C Love IV and ▇▇▇ ▇▇▇▇▇ to retire their 66% stock interest back to
Indigo Land and Development, Inc. for One Million Dollars. The agreements are
attached hereto as Exhibit C.
NOW, THEREFORE, in consideration of the premises and the mutual agreements,
representations, warranties and covenants herein contained, the parties do
hereby agree as follows:
ARTICLE I
EXCHANGE
TAX FREE
1.1 Exchange of Stock of Indigo. At the Closing Date (as defined in Article
IX hereof) in accordance with the provisions of this Agreement and applicable
law, the Shareholders shall exchange, assign and transfer, and Procare shall
acquire all of the Stock of Indigo owned by the Shareholders, as a tax free
exchange pursuant to IRS Sec. 368 as well as the list attached hereto.
ARTICLE II
CONSIDERATION FOR EXCHANGE
2.1 Original Issuance. Procare shall issue for the Stock exchanged
hereunder a total of 176,457,126 shares of the common stock of Procare (see
attached Schedule for share distribution to Indigo Investors).
2.2 Investment Representations. The Shareholders shall cause to be
delivered on the Closing Date an investment letter representing their compliance
with the Securities Act of 1933, as amended.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF INDIGO AND SHAREHOLDERS
Shareholders represent and warrant to Procare as follows:
3.1 Organization. Indigo is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Virginia, has the
corporate power and authority to own or lease its properties.
3.2 Capitalization. The authorized capital stock of Indigo, as of the date
hereof, consists of one class of shares of capital stock: Common Stock, of which
5,000 shares are validly issued and outstanding, fully paid and nonassessable.
There are no existing options, warrants, calls or commitments on the part of
Indigo of any character relating to shares of capital stock of Indigo.
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3.3 Financial Statements. The Shareholders have furnished to Procare the
audited financial statements of Indigo as of September 30, 2005. All of said
financial statements (i) are in accordance with Indigo's books and records, (ii)
present fairly the financial position of Indigo as of such date, and its results
of operations for the period indicated, (iii) have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis, and
(iv) are consistent with prior business practice.
3.4 Authorization. Shareholders have the power to enter into this
Agreement, and this Agreement, when duly executed and delivered, will constitute
the valid and binding obligation of the Shareholders.
3.5 Effect of Agreement. The execution and delivery of this Agreement by
the Shareholders and the consummation of the transactions herein contemplated,
to the best knowledge and belief of Shareholders (i) will not conflict with or
result in a breach of the terms of, or constitute a default under or violation
of, any law or regulation of any governmental authority, or the Articles of
Incorporation or By-laws of Indigo, or any material agreement or instrument to
which Indigo or the Shareholders are a party or by which it or any of them is
bound or to which it or any of them is subject, (ii) nor will it give to others
any interests or rights, including rights of termination, acceleration or
cancellation, in or with respect to any of the properties, assets, leases,
agreements, or business of Indigo.
3.6 Owned Mineral Rights. Indigo has furnished Procare with a true and
complete statement of its operations, leases and title work, (with the exception
of coal as a mineral but includes coal gas and the leases are mineral rights
also.
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3.7 Absence of Undisclosed Liabilities. Indigo has disclosed the details of
its obligations to ▇▇▇ ▇▇▇▇ and ▇▇▇ ▇▇▇▇▇, and hereby attests it has no
additional material liability or obligation which has not been previously
disclosed to Procare, either accrued, absolute, contingent or otherwise,
including, without limitation, liabilities for federal, state and local taxes,
except (i) as reflected on the Balance Sheet, or (ii) liabilities in amounts
usual and normal for Indigo.
There are two (2) outstanding notes to be disclosed on the Indigo balance sheet.
3.8 Minute Book. The records of meetings and other corporate actions of
Shareholders and the Board of Directors (including any committees of the Board)
of Indigo which are contained in the Minute Books of Indigo contain complete and
accurate records of the matters reflected in such Minutes.
3.9 Litigation Claims. Indigo is not a party to and there are no claims,
actions, suits, investigations or proceedings pending or, to the best knowledge
and belief of the Shareholders, threatened against or affecting Indigo or its
business except commercial litigation between Indigo and its competitors and
customers.
3.10 Taxes and Reports. Indigo (i) has filed all tax returns required to be
filed by any jurisdiction, domestic or foreign, to which it is or has been
subject except returns for 2005, (ii) has either paid in full all taxes due and
taxes claimed to be due by each such jurisdiction, and any interest and
penalties with respect thereto, or (iii) has adequately reflected as liabilities
on its books, all taxes that have accrued prior to 2005.
3.11. Absence of Certain Charges. Since September 30, 2005, Indigo has not
(i) issued, delivered or agreed to issue or deliver to any person any shares of
Stock, bonds or other corporate securities (whether authorized but unissued or
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held in treasury) or granted to any person any options, warrants or other rights
calling for the issuance thereof, that is not disclosed on the balance sheet of
Indigo, (ii) incurred any obligation or liability (absolute or contingent),
except obligations and liabilities incurred in the ordinary course of business,
(ii) discharged or satisfied any lien or encumbrance, or paid any obligation or
liability (absolute or contingent) other than current liabilities and the
current portion of long-term liabilities incurred since the date of the Balance
Sheet in the ordinary course of business, (iv) declared or made any payment or
distribution to Shareholders, or purchased or redeemed any shares of stock, (v)
made any wage or salary or commission increases to any employee, (v) mortgaged
or pledged any assets (tangible or intangible) except reserved coal and stock
transfer agreements or subjected any assets to lien or other encumbrance, (vii)
sold or transferred any tangible assets or canceled any debts or claims, except
in the ordinary course of business or in any event not in an aggregate amount
which is material, or (viii) agreed to any of the foregoing. Except as otherwise
contemplated by this Agreement, since September 30, 2005, there has been no
material adverse change in the business or financial condition of Indigo.
3.12 Compliance With Laws and Regulations. Indigo has complied with and is
not in violation of any federal, state, local or foreign statute, law, rule or
regulation with respect to the conduct of its business, which violation might
have a material adverse effect on the business, financial condition or earnings
of Indigo.
3.13 Ownership of the Stock. The Shareholders represent and warrant that on
the Closing Date there will be the beneficial and record owners, free and clear
of any encumbrances, (see obligations on balance sheet) of all of the shares of
Indigo's stock sold and delivered by them hereunder.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PROCARE
Procare represents and warrants to Shareholders and Indigo, and each of
them, as follows:
4.1 Organization. Procare is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Nevada. Procare has
the corporate power and authority to own or lease its properties and to carry on
its business as now being conducted.
4.2 Capitalization. The authorized capital stock of Procare as of the date
hereof consists of 500,000,000 shares of common stock, of which 16,861,127
shares will be validly issued and outstanding, fully paid and non-assessable
prior to closing.
4.3 SEC Filings; Undisclosed Liabilities. Procare has filed all
reports, schedules, forms, statements and other documents as required by the
Securities and Exchange Commission (the "SEC") and Procare has delivered or made
available to the Indigo and the Shareholders all reports, schedules, forms,
statements and other documents filed with the SEC (collectively, and in each
case including all exhibits and schedules thereto and documents incorporated by
reference therein, the "Procare SEC Documents"). As of their respective dates,
the Procare SEC Documents complied in all material respects with the
requirements of the Securities Act or the Securities Exchange Act of 1934, as
the case may be, and the rules and regulations of the SEC promulgated hereunder
applicable to such Procare SEC documents, and none of the Procare SEC Documents
(including any and all consolidated financial statements included therein) as of
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such date contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Except to the extent revised or superseded by a subsequent
filing with the SEC (a copy of which has been provided to the Shareholders and
Indigo prior to the date of this Agreement), none of the Procare SEC Documents,
to the knowledge of Procare's management, contains any untrue statement of a
material fact or omits to state any material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The consolidated financial statements of Procare included in such
Procare SEC Documents comply as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto, have been prepared in accordance with generally accepted
accounting principles (except, in the case of unaudited consolidated quarterly
statements, as permitted by Form 10-QSB of the SEC) applied on a consistent
basis during the periods involved (except as may be indicated in the notes
thereto) and fairly present the consolidated financial position of Procare and
its consolidated subsidiaries as of the dates thereof and the consolidated
results of operations and changes in cash flows for the periods then ended
(subject, in the case of unaudited quarterly statements, to normal year-end
audit adjustments as determined by Procare's independent accountants). Except as
set forth in the Procare SEC Documents, at the date of the most recent audited
financial statements of Parent included in the Procare SEC Documents, neither
Procare nor any of its subsidiaries had, and since such date neither Procare nor
any of such subsidiaries has incurred, any liabilities or obligations of any
nature (whether accrued, absolute, contingent or otherwise) which, individually
or in the aggregate, could reasonably be expected to have a material adverse
effect with respect to Procare.
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4.4 Tax Returns and Tax Payments. Procare has filed all Tax Returns
required to be filed by it, has paid all Taxes shown thereon to be due and has
provided adequate reserves in its financial statements for any Taxes that have
not been paid, whether or not shown as being due on any returns. No material
claim for unpaid Taxes has been made or become a lien against the property of
Procare or is being asserted against Procare, no audit of any Tax Return of
Procare is being conducted by a tax authority, and no extension of the statute
of limitations on the assessment of any Taxes has been granted by Parent and is
currently in effect.
4.5 Authorization. Procare has the power to enter into this Agreement, and
this Agreement when duly executed and delivered, will constitute the valid and
binding obligation of Procare.
4.6 Absence of Undisclosed Liabilities. Procare has no material liability
or obligation, either accrued, absolute, contingent or otherwise, including
without limitation, liabilities for federal, state and local taxes, except (i)
the outstanding withholding tax liability previously disclosed.
4.7 Minute Book. The records of meetings and other corporate actions of
Shareholders and the Board of Directors (including any committees of the Board)
of Procare which are contained in the Minute books of Procare contain complete
and accurate records of the matters reflected in such minutes. (▇▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ to update after closing)
4.8 Litigation; Claims. Procare is not a party and there are no claims,
actions, suits, investigations or proceedings pending or threatened against or
affecting Procare at law or in equity or before or by any governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, which if determined adversely would have a material adverse effect in
the business or financial condition of Indigo or the ability of Indigo to carry
on its business as presently conducted. The consummation of the transaction
herein contemplated will not conflict with or result in the breach or violation
of any judgment, order, writ, injunction or decree of any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign.
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4.8 Finders. Procare is not obligated, absolutely or contingently, to any
person for financial advice, a finder's fee, brokerage commission or other
similar payment in connection with the transactions contemplated by this
Agreement. ▇▇▇ ▇▇▇▇ and ▇▇▇ ▇▇▇▇▇ have received compensation (Love $250,000 and
▇▇▇▇▇ $100,000 to date and Indigo is working out the other payment of $250,000
to Love and $400,000 to ▇▇▇▇▇ on a note and stock over time in 2006) for their
stock returned to treasury. ▇▇▇▇▇ ▇▇▇▇▇ for his stock is receiving a delayed
payment note of $3.4 M for his stock transfer and 24 years of service to the
corporation. Delayed note payments will be paid out over a 5 year period based
upon cash flow issues.
ARTICLE V
ACCESS TO INFORMATION
5.1 Access to Information. The Shareholders and Indigo shall afford each
others' representatives reasonable access to Indigo and such of the financial,
contractual and corporate records as shall be reasonably necessary.
5.2 Effect of Investigation. Any such investigation shall not affect any of
the representations and warranties hereunder and shall not be conducted in such
manner as to interfere unreasonably with the operation of business.
ARTICLE VI
CONDUCT OF SHAREHOLDERS AND INDIGO PRIOR TO THE CLOSING
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The Shareholders agree to exchange all outstanding shares of Stock of
Indigo in accordance with this Agreement and the Shareholders further covenant
and agree as follows:
6.1 Notice of Defaults. The Shareholders will give prompt notice of any
default to Procare subsequent to the date of this Agreement and prior to the
Closing Date under any instrument or agreement to which Indigo is a party or by
which it is bound, of assertion of any claims which, if upheld, would render
inaccurate any representation herein.
6.2 Action Needing Consent. Except as otherwise contemplated or permitted
by this Agreement, between the date hereof and the Closing Date or termination
of this Agreement, whichever shall first occur, Procare will not, without the
prior written consent of Indigo (i) make any changes in its authorized capital
stock, (ii) issue stock options or warrants or similar rights, (iii) declare or
pay any stock dividend or make any reclassification in respect of their
outstanding shares of capital stock, (iv) issue or sell shares of their capital
stock (or securities convertible into or exchange for, with or without
additional consideration, such capital stock), (v) purchase or otherwise acquire
for a consideration any outstanding shares of their capital stock, (vi) declare,
pay or set apart in respect of their capital stock any cash dividend or their
distribution or payment, (vii) enter into any merger or consolidation except for
the issuance of shares, except as disclosed previously in its balance sheet.
6.3 Implementation of Representations and Warranties. Shareholders and
Indigo will take all action to render accurate as of the Closing Date their
representations and warranties contained in this Agreement, and Indigo and the
Shareholders will refrain from taking any action which would render inaccurate
as of the Closing Date any such representations and warranties.
Indigo will take all action to render accurate as of the Closing Date its
representations and warranties contained in this Agreement, and Indigo and the
Shareholders will refrain from taking any action which would render inaccurate
as of the Closing Date any such representations and warranties.
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ARTICLE VII
CONDITIONS TO OBLIGATIONS OF PROCARE
The obligations of Procare under this Agreement are, at the option of
Procare subject to the satisfaction, at and prior to the Closing Date, of the
following conditions:
7.1 Fulfillment of Covenants. All the terms, covenants, and conditions of
this Agreement are to be complied with and performed by Shareholders and Indigo
at or before the Closing Date shall have been duly complied with and performed.
7.2 Accuracy of Representations and Warranties; Other Documents. All of the
representations and warranties made by all parties to this Agreement shall be
true as of the Closing Date.
7.3 No Adverse Changes. Since September 30, 2005, the business, properties
or operations of Procare or its subsidiaries shall not have been adversely
affected in any material way as a result of any fire, accident, or other
casualty or any labor disturbance or act of God. There shall not have occurred
any material adverse change since September 30, 2005 in the business,
properties, results of operations or financial condition of Procare, except for
those transactions contemplated or permitted by this Agreement.
7.4 No Litigation. There shall be no action, proceeding, investigation or
pending or actual litigation the purpose of which is to enjoin or may be to
enjoin the transactions contemplated by this Agreement or which would have the
effect, if successful, of imposing a material liability upon Procare or any of
the officers or directors thereof, because of the consummation of the
transactions contemplated by this Agreement.
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ARTICLE VIII
CONDITIONS TO OBLIGATIONS OF SHAREHOLDERS
The obligations of Shareholders under this Agreement are at the option of
Shareholders, subject to the satisfaction at and prior to the Closing Date of
the following conditions:
8.1 Approval of Agreement. The transaction contemplated by this Agreement
shall have been approved by (i) all corporate action required by law to be taken
by Indigo (ii) all other statutory requirements for the valid consummation of
the transaction contemplated by this Agreement shall have been fulfilled.
8.2 No Litigation. There shall be no litigation pending which has been
brought with the purpose of enjoining the transactions contemplated by this
Agreement or which would have the effect, if successful, of imposing a material
liability upon Shareholders, because of the transactions contemplated by this
Agreement. 8.3 Appointment of New Officers and Directors and Resignations.
Procare shall deliver to the Shareholders, the written resignations of all of
the officers of Procare and evidence of election of the following new directors
and officers:
Name Positions
---- ---------
▇▇▇▇ ▇▇▇▇▇ President
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Secretary Treasurer
▇▇▇▇▇ ▇▇▇▇▇▇▇ Vice President
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8.4 Reorganization 8-K. Procare shall have filed a Form 8-K with the SEC
within four days of the execution of this Agreement containing the information
required by Item 5.06 of Form 8-K regarding this Agreement as well as a 14C
Information Statement regarding the new directors and the change of the
Procare's name to Indigo - Energy, Inc.
8.5 Delivery of Stock Certificates. Within 6 business days, Procare shall
deliver stock certificates registered in the name of the Shareholders in
Indigo-Energy Inc.
ARTICLE IX
CLOSING
9.1 Closing Date. The consummation of the exchange of the Stock by
Shareholders to Indigo (the "Closing") shall take place on such time or place as
shall be mutually agreed upon by the parties to this Agreement but no later than
December 31, 2005.
9.2 Actions To Be Taken By Parties On The Closing Date. On the Closing
Date, each party shall deliver to the other all documents or agreements provided
for herein to be delivered on the Closing Date.
ARTICLE X
INDEMNIFICATION AND ARBITRATION
10.1 Indemnification. Each of the parties agree to indemnify and hold
harmless the other against any and all damages, claims, losses, expenses,
obligations and liabilities (including reasonable attorney's fees)(hereinafter
collectively referred to as "Claims") resulting from or relating to any breach
of, or failure by, each of the parties to perform any of their representations,
warranties, covenants, conditions or agreements in this Agreement or in any
schedule, certificate, exhibit, or other document furnished or to be furnished
under this Agreement. Arbitration if needed, will occur in Fairfax, County, VA
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ARTICLE XI
PAYMENT OF EXPENSES
Procare shall pay the expenses of preparing, assembling, printing and
mailing the proxy forms.
ARTICLE XII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
All statements contained in the Schedules, any Exhibit or other instrument
delivered by or on behalf of the Shareholders or in connection with the
transactions contemplated by this Agreement, shall be deemed to be
representations and warranties hereunder. Not withstanding any investigations
made by or on behalf of the parties to this Agreement, all representations,
warranties and agreements made by the parties to this Agreement or pursuant
hereto shall survive for as long as any applicable law concerning this
agreement.
ARTICLE XIII
GENERAL
13.1 Notice. Any notice, request. instruction or other document to be given
and received hereunder by any party to the other shall be in writing and in the
case of required notices, shall be considered given when either delivered
personally or ten days after being placed in the mails, certified, postage
prepaid, and addressed as follows:
To Shareholders:
----------------
To Indigo:
----------
Indigo Land and Development Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇ Ph.D.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ C Love
Attorney at Law
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
To Procare:
-----------
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇. #▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
or to such other addresses as may be designated in writing by the parties hereto
by a notice given as aforesaid.
13.2 Heading. The headings of the several sections of this Agreement are
inserted for convenience of reference only and are not intended to affect the
meaning or interpretation of this Agreement.
13.3 Counterparts. This Agreement may be executed in counter parts, and
when so executed each counterpart shall be deemed to be an original and said
counterparts together shall constitute one and the same instrument.
13.4 Binding Nature. This Agreement shall be binding upon and inure to the
benefit of the parties hereto. Neither Indigo nor the Shareholders may assign or
transfer any rights under this Agreement.
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13.6 Other Agreements. All written agreements heretofore made between the
parties hereto in contemplation of this Agreement are superseded by this
Agreement and are hereby terminated in their entirety.
13.7 Good Faith. Each of the parties hereto agrees that it shall act in
good faith in an attempt to cause all the conditions precedent to their
respective obligations to be satisfied.
13.8 Amendment or Modification. The parties hereto may amend or modify this
Agreement by a written instrument executed by such parties, with the consent of
each party.
13.9 Applicable Law. This Agreement shall be governed by the laws of the
State of Nevada. Witness the due execution of this Agreement by the parties
hereto as of the date first above written.
INDIGO LAND AND DEVELOPMENT, INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------
▇▇▇▇▇ ▇ ▇▇▇▇▇, Director
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------
▇▇▇▇ ▇. ▇▇▇▇▇, Director
PROCARE AMERICA, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------
▇▇▇▇▇▇ ▇▇▇▇▇, Director
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Director
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SCHEDULE B
Procare shareholders pledged shares
Pledged Shares Restricted 2 for 1 Shares
-------------- -------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇ 228,125 456,250
▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇ 504,965 1,009,930
▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇ 87,770 175,540
▇▇▇▇▇ ▇ ▇▇▇▇▇▇ 400,000 200,000
▇▇▇▇ Schulsted 200,000 100,000
▇▇▇▇▇ ▇▇▇▇▇▇ 611,060 305,530
▇▇▇▇▇ ▇▇▇▇ 172,000 86,000
▇▇▇▇▇ Street Investments 500,000 0
Total Shares 3,524,780 2,012,390
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