PLAN AND AGREEMENT OF MERGER
OF
▇▇▇▇▇▇ INDUSTRIES, INC.
AND
N-VISION TECHNOLOGY, INC.
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DATED AS OF NOVEMBER 20, 2000
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TABLE OF CONTENTS
PREAMBLE 5
ARTICLE I.
MERGER 6
1.1 SURVIVING CORPORATION
1.2 STOCKHOLDER APPROVAL
1.3 ACCEPTANCE OF THE PLAN OF REORGANIZATION
1.4 EFFECTIVE DATE
1.5 NAME AND CONTINUED CORPORATE EXISTENCE OF SURVIVING CORPORATION
1.5.1 NAME AND EXISTENCE
1.5.2 FEDERAL INCOME TAX TREATMENT OF MERGER
1.6 DELAWARE LAW GOVERNS AND ▇▇▇▇▇▇ CERTIFICATE OF 7
INCORPORATION, AS AMEND RESTATED, SURVIVES
1.7 BYLAWS OF SURVIVING CORPORATION
1.8 DIRECTORS OF SURVIVING CORPORATION
1.9 OFFICERS OF SURVIVING CORPORATION
1.10 VACANCIES
1.11 CAPITAL STOCK OF SURVIVING CORPORATION
1.12 CONVERSION OF SECURITIES UPON MERGER
1.12.1 GENERAL
1.12.2 CONVERSION OF ▇▇▇▇▇▇ COMMON STOCK
1.12.3 CONVERSION OF N-VISION INTO NEWCO COMMON STOCK 8
1.12.4 ▇▇▇▇▇▇ OPTIONS AND WARRANTS
1.12.5 N-VISION OPTIONS AND WARRANTS
1.12.6 EXCHANGE OF COMMON STOCK CERTIFICATES
1.12.7 EXCHANGE PROCEDURES
1.13 NEWCO FRACTIONAL SHARES 9
1.14 N-VISION'S TRANSFER BOOKS CLOSED
1.15 CONVEYANCES TO SURVIVING CORPORATION
1.16 ACCOUNTING TREATMENT
1.17 UNCLAIMED MERGER CONSIDERATION
1.18 DISSENTING STOCKHOLDERS OF N-VISION
ARTICLE II.
REPRESENTATIONS AND WARRANTIES OF N-VISION
2.1 REPRESENTATIONS AND WARRANTIES OF N-VISION 10
2.1.1 ORGANIZATION AND STANDING
2.1.2 AGREEMENT AUTHORIZED AND ITS EFFECT ON OTHER OBLIGATIONS
2.1.3 CAPITALIZATION
2.1.4 REPORTS AND FINANCIAL STATEMENTS
2.1.5 LIABILITIES 11
2.1.6 ABSENCE OF CERTAIN CHANGES AND EVENTS
2.1.6.1 FINANCIAL CHANGE
2.1.6.2 PROPERTY DAMAGE
2.1.6.3 DIVIDENDS
2.1.6.4 CAPITALIZATION CHANGE
2.1.6.5 LABOR DISPUTES
2.1.6.6 OTHER MATERIAL CHANGES
2.1.7 COMPLIANCE WITH OTHER LAWS
2.1.8 FINDER'S FEE 12
2.1.9 INVESTIGATIONS, LITIGATION
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇
3.1 REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇
3.1.1 ORGANIZATION AND STANDING
3.1.2 AGREEMENT AUTHORIZED AND ITS EFFECT ON OTHER OBLIGATIONS
3.1.3 CAPITALIZATION
3.1.4 REPORTS AND FINANCIAL STATEMENTS 13
3.1.5 LIABILITIES
3.1.6 ABSENCE OF CERTAIN CHANGES AND EVENTS
3.1.6.1 FINANCIAL CHANGE
3.1.6.2 PROPERTY DAMAGE
3.1.6.3 DIVIDENDS
3.1.6.4 CAPITALIZATION CHANGE
3.1.6.5 LABOR DISPUTES
3.1.6.6 OTHER MATERIAL CHANGES 14
3.1.7 FINDER'S FEE
3.1.8 INVESTIGATIONS, LITIGATION
ARTICLE IV.
OBLIGATIONS PENDING EFFECTIVE DATE
4.1 AGREEMENTS OF ▇▇▇▇▇▇ AND N-VISION
4.1.1 MAINTENANCE OF PRESENT BUSINESS
4.1.2 MAINTENANCE OF PROPERTIES
4.1.3 MAINTENANCE OF BOOKS AND RECORDS 15
4.1.4 COMPLIANCE WITH LAW
4.1.5 INSPECTION OF EACH MERGING CORPORATION
4.2 ADDITIONAL AGREEMENTS OF ▇▇▇▇▇▇ AND N-VISION
4.2.1 NOTICE OF MATERIAL DEVELOPMENT
4.2.2 BEST EFFORTS 16
4.3 ADDITIONAL AGREEMENTS OF N-VISION
4.3.1 DISPOSAL OF ASSETS
4.3.2 MAINTENANCE OF INSURANCE
4.3.3 NO AMENDMENT TO CERTIFICATE OF INCORPORATION, ETC. 17
4.3.4 PROHIBITION ON DIVIDENDS
4.3.5 STOCKHOLDERS' MEETING
4.3.6 NO SOLICITATION
4.4 ADDITIONAL AGREEMENTS OF ▇▇▇▇▇▇
4.4.1 PLAN OF REORGANIZATION
4.4.2 DIRECTORS AND OFFICERS INSURANCE
4.4.3 NO SOLICITATION
ARTICLE V.
CONDITIONS PRECEDENT TO OBLIGATIONS
5.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF ▇▇▇▇▇▇ 18
5.1.1 REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇ TRUE AT EFFECTIVE DATE
5.1.2 NO MATERIAL LITIGATION
5.1.3 APPROVAL OF PLAN OF REORGANIZATION 19
5.1.4 UNEXERCISED N-VISION OPTIONS
5.1.5 WAIVER OF ANTI-DILUTION ADJUSTMENT
5.2 CONDITIONS PRECEDENT TO OBLIGATIONS OF N-VISION
5.2.1 REPRESENTATIONS AND WARRANTIES OF N-VISION TRUE AT EFFECTIVE DATE
5.2.2 NO MATERIAL LITIGATION 20
5.2.3 STOCKHOLDER APPROVAL
5.2.4 CONSENT OF CERTAIN PARTIES IN PRIVITY WITH N-VISION
ARTICLE VI.
TERMINATION AND ABANDONMENT
6.1 TERMINATION
6.1.1 BY MUTUAL CONSENT
6.1.2 BY ▇▇▇▇▇▇ BECAUSE OF CONDITIONS PRECEDENT
6.1.3 BY ▇▇▇▇▇▇ BECAUSE OF MATERIAL ADVERSE CHANGE
6.1.4 BY N-VISION BECAUSE OF CONDITIONS PRECEDENT 21
6.1.5 BY N-VISION BECAUSE OF MATERIAL ADVERSE CHANGE
6.1.6 BY ▇▇▇▇▇▇ OR N-VISION BECAUSE OF LEGAL PROCEEDINGS
6.1.7 BY N-VISION IF MERGER NOT EFFECTIVE BY MAY 31, 2000
6.1.8 BY ▇▇▇▇▇▇ OR N-VISION BECAUSE OF DUE DILIGENCE
6.2 TERMINATION BY BOARD OF DIRECTORS
6.3 EFFECT OF TERMINATION
6.4 WAIVER OF CONDITIONS
6.5 EXPENSE ON TERMINATION
6.5.1 PAYMENT OF FEES TO COUNSEL FOR ▇▇▇▇▇▇ 22
ARTICLE VII.
ADDITIONAL AGREEMENTS
7.1 INDEMNIFICATION BY N-VISION
7.2 INDEMNIFICATION BY ▇▇▇▇▇▇
ARTICLE VIII.
MISCELLANEOUS
8.1 ENTIRETY
8.2 COUNTERPARTS
8.3 NOTICES AND WAIVERS 23
8.4 TERMINATION OF REPRESENTATIONS, WARRANTIES, ETC.
8.5 TABLE OF CONTENTS AND CAPTIONS
8.6 SUCCESSORS AND ASSIGNS
8.7 SEVERABILITY
8.8 APPLICABLE LAW
8.9 PUBLIC ANNOUNCEMENTS 24
SIGNATURES
PLAN AND AGREEMENT OF MERGER
PLAN AND AGREEMENT OF MERGER, dated as of September 18, 2000, between
▇▇▇▇▇▇ Industries, Inc., a Delaware corporation ("▇▇▇▇▇▇") and N-Vision
Technology, Inc., a Nevada Corporation ("N-Vision"). ▇▇▇▇▇▇ and N-Vision are
hereinafter collectively referred to as the "Merging Corporations." The
surviving Corporation, referred to herein as "NEWCO" will be a Delaware Company
with the name N-Vision Technology, Inc.
WHEREAS, ▇▇▇▇▇▇ is a corporation duly organized and validly existing
under the laws of the State of Delaware, with its registered office at
Corporation Trust Company, Corporation Trust Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
WHEREAS, the authorized capital stock of ▇▇▇▇▇▇ consists of 5,000,000
shares of cumulative convertible preferred stock, $.01 par value, of which at
October 12, 2000, no shares were issued or outstanding; and 50,000,000 shares of
common stock, par value $.01 per share ("▇▇▇▇▇▇ Common Stock"), of which at
September 18, 2000, 9,522,540 shares were issued and outstanding, and any
additional shares reserved for issuance in conjunction with various employee
benefit plans, the exercise of various warrant agreements or options shall be
cancelled and at the same date, no shares of ▇▇▇▇▇▇ Common Stock were held in
▇▇▇▇▇▇ treasury;
WHEREAS, N-Vision is a corporation duly organized and validly existing
under the Laws of the State of Nevada with its registered office at CT Corp.,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, and the principal executive office at
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇;
WHEREAS, the authorized capital stock of N-Vision consists of no shares
of preferred stock which were authorized, issued or outstanding; and 50,000,000
shares of common stock, par value $.01 per share (the "N-Vision Common Stock"),
of which at October 12, 2000, 8,129,745 shares were issued and outstanding; an
additional 600,000 shares were reserved for issuance in conjunction with various
options and an additional 400,000 shares were reserved for issuance in
conjunction with various warrants; at the same date, no shares of N-Vision
Common Stock were held in N-Vision treasury; and
WHEREAS, ▇▇▇▇▇▇ has filed for protection under Chapter 11 of Title
11 of the United States Code in the United States Bankruptcy Court, Southern
District of Texas, Corpus Christi Division (the "Bankruptcy Court"), case no.
99-21792-C-11 and shall file this Merger Agreement as part of its proposed Plan
of Reorganization; and
WHEREAS, the respective boards of directors of ▇▇▇▇▇▇ and N-Vision deem
it desirable and in the best interests of their respective corporations and
their respective stockholders that N-Vision be merged into ▇▇▇▇▇▇ pursuant to
the provisions of Section 251 of the General Corporation Law of the State of
Delaware, in exchange for the consideration herein provided, and have proposed,
declared advisable, and approved such merger pursuant to this Plan and Agreement
of Merger (the "Merger Agreement" or "Agreement"), which Merger Agreement has
been duly approved by resolutions of the respective boards of directors of
▇▇▇▇▇▇ and N-Vision;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, and in order to set forth the terms
and conditions of the merger, the mode of carrying the same into effect, the
manner and basis of converting the presently outstanding shares of N-Vision
Common Stock and ▇▇▇▇▇▇ Common Stock into shares of NEWCO (as herein defined),
and such other details and provisions as are deemed necessary or proper, the
parties hereto agree as follows:
ARTICLE I.
MERGER
1.1 SURVIVING CORPORATION. Subject to the adoption and approval of this
Merger Agreement by the requisite authority of each of the Merging Corporations,
the approval of the ▇▇▇▇▇▇ Plan of Reorganization by the Bankruptcy Court and to
the other conditions hereinafter set forth, ▇▇▇▇▇▇ and N-Vision shall be, upon
the Effective Date of the merger as defined in Paragraph 1.3 hereof, merged into
a single surviving corporation, which shall be ▇▇▇▇▇▇, one of the Merging
Corporations, which shall continue its corporate existence and remain a Delaware
corporation governed by and subject to the laws of that state, but shall however
change its name to N-Vision Technology, Inc. ("NEWCO").
1.2 STOCKHOLDER APPROVAL. This Merger Agreement shall be submitted for
adoption and approval by the stockholders of N-Vision in accordance with their
Certificate of Incorporation and the applicable laws of the State of Nevada.
1.3 ACCEPTANCE OF THE PLAN OF REORGANIZATION. A mutually agreeable Plan of
Reorganization of ▇▇▇▇▇▇ Industries, Inc. (the "Plan of Reorganization") shall
have been prepared and submitted in conjunction with this Plan of Merger to the
Bankruptcy Court for approval. The Plan of Merger shall be consummated only at
such time as the Plan of Reorganization, contemplating such Plan of Merger and
associated Merger Agreement, substantially in the form and substance contained
herein, is approved by entry of an order of the Bankruptcy Court.
1.4 EFFECTIVE DATE. The merger shall become effective upon the date of
approval by entry of an order of the Plan of Reorganization by the Bankruptcy
Court and subsequent filing of a Certificate of Merger with the Secretary of
State of the State of Delaware in accordance with Section 251 (c) of the General
Corporation Law of the State of Delaware. The date upon which the merger shall
become effective is referred to in this Merger Agreement as the "Effective
Date."
1.5 NAME AND CONTINUED EXISTENCE OF SURVIVING CORPORATION.
1.5.1 NAME AND EXISTENCE. On the Effective Date, the identity, existence,
purposes, powers, objects franchises, rights, and immunities of NEWCO, the
surviving corporation of the merger, shall be the corporate identity, existence,
purposes, powers, objects, franchises, rights and immunities of N-Vision which
will be wholly merged into NEWCO, the Surviving Corporation. Accordingly, on the
Effective Date, the separate existence and identity of ▇▇▇▇▇▇, except insofar as
continued by statute, shall cease, and the name of the surviving corporation
shall be changed to N-Vision Technology, Inc.
1.5.2 FEDERAL INCOME TAX TREATMENT OF MERGER. The merger is intended to
qualify as and, subject to the requirements of Section 368 (a) (1) (A) of the
Internal Revenue Code of 1986, as amended (the "Code"), shall be characterized
as a "reorganization" as defined in Section 368 (a) (1) (A) of the Code.
1.6 DELAWARE LAW GOVERNS AND ▇▇▇▇▇▇ CERTIFICATE OF INCORPORATION, AS
AMENDED AND RESTATED, SURVIVES. The laws of Delaware shall continue to govern
the Surviving Corporation. On the Effective Date, the Certificate of
Incorporation of ▇▇▇▇▇▇ (the "Certificate of Incorporation") shall be the
certificate of incorporation of the Surviving Corporation until further amended
in the manner provided by law.
1.7 BYLAWS OF SURVIVING CORPORATION. Effective as of the Effective
Date, the bylaws of N-Vision (the "Bylaws") shall be the bylaws of the Surviving
Corporation until altered, amended, or repealed, or until new bylaws shall be
adopted in accordance with the provisions of law, the Certificate of
Incorporation and the Bylaws.
1.8 DIRECTORS OF SURVIVING CORPORATION. The directors of N-Vision shall
continue to uphold their respective positions on the board of directors of the
Surviving Corporation from and after the Effective Date, and until their
successors are duly elected and qualify in accordance with the Certificate of
Incorporation and Bylaws of the Surviving Corporation.
1.9 OFFICERS OF SURVIVING CORPORATION. The officers of N-Vision shall
continue to hold their respective offices of the Surviving Corporation from and
after the Effective Date, and until their successors are duly elected and
qualify in accordance with the Certificate of Incorporation and Bylaws of the
Surviving Corporation.
1.10 VACANCIES. On or after the Effective Date, if a vacancy shall
exist for any reason in the board of directors or in any of the offices of the
Surviving Corporation, such vacancy shall be filled in the manner provided in
the Certificate of Incorporation or Bylaws of the Surviving Corporation.
1.11 CAPITAL STOCK OF SURVIVING CORPORATION. The authorized number of
shares of capital stock of the Surviving Corporation, and the par value,
designations, preferences, rights, and limitations thereof, and the express
terms thereof, shall be as set forth in the Certificate of Incorporation.
1.12 CONVERSION OF SECURITIES UPON MERGER.
1.12.1 GENERAL. The manner and basis of converting the issued
and outstanding shares of the capital stock of both ▇▇▇▇▇▇ and N-Vision into
shares of the capital stock of NEWCO shall be as hereinafter set forth in this
Paragraph 1.12. The Common Stock (defined in Paragraph 1.12.2) into which the
N-Vision Common Stock is converted hereunder is hereinafter referred to
collectively as the "Merger Consideration."
1.12.2 CONVERSION OF ▇▇▇▇▇▇ COMMON STOCK. In connection with the
proposed Plan of Reorganization and Merger, current shareholders of ▇▇▇▇▇▇ will
receive 476,127 shares of NEWCO stock. That is one share for every twenty shares
of ▇▇▇▇▇▇ they currently own, (i.e. a 1 for 20 reverse split). Also, as per the
Plan or Reorganization, 1,428,381 shares of NEWCO stock shall be issued for the
benefit of the Allowed General Unsecured Creditors of ▇▇▇▇▇▇ to be distributed
as per the terms of that Plan of Reorganization. This Agreement and the merger
contemplated hereby anticipates that shareholders of ▇▇▇▇▇▇ Common Stock,
inclusive of those shares issued to Allowed General Unsecured Creditors, shall
total 1,904,508 shares when converted to NEWCO stock prior to the Merger with
N-Vision. An Additional 500,000 shares of NEWCO shall be held in trust for the
benefit of any unsatisfied Allowed Priority Tax Claims and Allowed Priority
Claims (as defined in the Plan of Reorganization) pursuant to Articles 3.3 and
4.1, respectively, of the Plan of Reorganization filed on behalf of ▇▇▇▇▇▇ and
incorporated herein by reference.
1.12.3 CONVERSION OF N-VISION INTO NEWCO COMMON STOCK. Each share of
N-Vision Common Stock then issued and outstanding and held by holders of
N-Vision Common Stock qualified to receive NEWCO Common Stock in the merger
under this Paragraph 1.12.2.1, without any action on the part of the holders
thereof, shall automatically become and be converted into one fully paid and
nonassessable share of unregistered NEWCO Common Stock.
1.12.4 ▇▇▇▇▇▇ OPTIONS AND WARRANTS. NEWCO shall not assume any obligations
with respect to ▇▇▇▇▇▇'▇ previously issued rights and obligations with respect
to any outstanding options or warrants, nor will it be obligated to substitute
NEWCO options for such options. All currently issued and outstanding ▇▇▇▇▇▇
warrants and all issued and outstanding ▇▇▇▇▇▇ options to purchase Common Stock
shall have been terminated in accordance with the terms and provisions of the
Plan of Reorganization prior to the merger contemplated hereby.
1.12.5 N-VISION OPTIONS AND WARRANTS. NEWCO shall assume any and all
obligations with respect to N-Visions previous rights and obligations with
respect to issued and outstanding options or warrants and will substitute NEWCO
options for such options and warrants. As a result, the terms of all currently
issued and outstanding options and warrants of N-Vision will remain in effect.
1.12.6 EXCHANGE OF COMMON STOCK CERTIFICATES. Commencing on the Effective
Date, each holder of an outstanding Certificate or Certificates representing
shares of Common Stock of ▇▇▇▇▇▇ or N-Vision may surrender the same to an
exchange agent (the "Exchange Agent") designated by NEWCO (which may be ▇▇▇▇▇▇'▇
transfer agent). Such holder shall be entitled to receive upon surrender and in
exchange therefore, a certificate or certificates representing the number of
whole shares of NEWCO Common Stock into which the shares of ▇▇▇▇▇▇ and N-Vision
Common Stock shall have been converted. However, before surrender, each
outstanding certificate representing issued and outstanding ▇▇▇▇▇▇ Common Stock
shall be deemed, for all purposes, only to evidence ownership of the number of
whole shares of ▇▇▇▇▇▇ Common Stock prior to the reverse split and assignment to
creditors as per the Plan of Reorganization and will not represent a one for one
correlation to converted shares of NEWCO.
1.12.7 EXCHANGE PROCEDURES. As soon as practicable after the Effective
Date, the Exchange Agent shall mail to each holder of record of a certificate or
certificates which immediately before the Effective Date represented outstanding
shares of ▇▇▇▇▇▇ Common Stock and N-Vision Common Stock (the "Certificates")
that were converted (the "Converted Shares") into the right to receive shares of
NEWCO Common Stock (i) a letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to the Certificates shall
pass, only upon actual delivery of the Certificates to the Exchange Agent) and
(ii) instructions for use in effecting the surrender to the Certificates in
exchange for certificates representing NEWCO Shares. Upon surrender of a
Certificate to the Exchange Agent (or to such other agent or agents as may be
appointed prior to the merger by agreement of ▇▇▇▇▇▇ and N-Vision), together
with a duly executed letter of transmittal and such other documents as the
Exchange Agent shall require, the holder of such Certificate shall be entitled
to receive in exchange therefore a certificate representing that number of whole
shares of NEWCO Common Stock which such holder has the right to receive. In the
event of a transfer of ownership of Converted Shares which is not registered in
the transfer records of ▇▇▇▇▇▇ or N-Vision, as the case may be, a certificate
representing the proper number of shares of ▇▇▇▇▇▇ Common Stock may be issued to
a transferee if the Certificate representing such Converted Shares is presented
to the Exchange Agent, accompanied by all documents required to evidence and
effect such transfer and by evidence satisfactory to the Exchange Agent that any
applicable stock transfer taxes have been paid. If any certificate shall have
been lost, stolen, mislaid or destroyed, upon receipt of (i) an affidavit of
that fact from the holder claiming such Certificate to be lost, stolen, mislaid
or destroyed, (ii) such bond, security or indemnity as the Surviving Corporation
or the Exchange Agent may reasonably require, and (iii) any other documentation
necessary to evidence and effect the bona fide exchange thereof, the Exchange
Agent shall issue to such holder a certificate representing the number of ▇▇▇▇▇▇
Shares into which the shares represented by such lost, stolen, mislaid or
destroyed Certificate shall be have been converted.
1.13 NEWCO FRACTIONAL SHARES. No certificates for fractional share
interests of Common Stock or will be issued. All such fractional share interests
will be rounded to the nearest whole share of NEWCO Common Stock or if more than
one Certificate representing Common Stock is surrendered by a ▇▇▇▇▇▇
stockholder, the number of full shares of NEWCO Common Stock into which such
Common Stock will be converted pursuant to the merger will be computed on the
basis of the aggregate number of Common Stock represented by all such
Certificates.
1.14 N-VISION TRANSFER BOOKS CLOSED. Upon the Effective Date, the stock
transfer books of N-Vision (the Nevada Corp.) shall be deemed closed, and no
transfer of any certificates theretofore representing shares of that corporation
shall thereafter be made or consummated. Any new shares issued by N-Vision
Technology, Inc. (the Delaware Corp.) "NEWCO" after the effective date shall be
issued in the Delaware Corporation.
1.15 CONVEYANCES TO SURVIVING CORPORATION. The Merging Corporations
hereby agree, respectively, that from time to time, as and when requested by the
Surviving Corporation, or by its successors and assigns, they will execute and
deliver or cause to be taken such further or other action as the Surviving
Corporation, its successors or assigns, may deem necessary or desirable to vest
or perfect in or confirm to the Surviving Corporation, its successors and
assigns, title to and possession of all the property, rights, privileges,
powers, immunities, franchises, and interests referred to in this Paragraph 1.15
and otherwise carry out the intent and purposes of this Merger Agreement.
1.16 ACCOUNTING TREATMENT. The assets and liabilities of N-Vision shall
be taken up on the books of the Surviving Corporation in accordance with
generally accepted accounting principles, and the capital surplus and retained
earnings accounts of the Surviving Corporation shall be determined, in
accordance with generally accepted accounting principles, by the board of
directors of the Surviving Corporation. Nothing herein shall prevent the board
of directors of the Surviving Corporation from making any future changes in its
accounts in accordance with law.
1.17 UNCLAIMED MERGER CONSIDERATION. Subject to any contrary provision
of governing law, all consideration deposited with the Exchange Agent (not
including shares, if any, that are distributed or placed with Exchange Agent for
distribution to ▇▇▇▇▇▇'▇ Allowed General Unsecured Creditors)and remaining
unclaimed for one year after the Effective Date, shall be paid or delivered to
NEWCO; and the holder of any unexchanged certificate or certificates which
before the Effective Date represented shares of ▇▇▇▇▇▇ Common Stock shall
thereafter look only to NEWCO for exchange or payment thereof upon surrender of
such certificate or certificates to NEWCO, provided however that,
notwithstanding the above, any shares conveyed to the Liquidating Trust (as
defined in the Plan or Reorganization) pursuant to Articles 3.3 and 4.1 or the
▇▇▇▇▇▇ Plan of Reorganization, to be liquidated, if necessary, to satisfy unpaid
Allowed Priority Tax Claims and Allowed Priority Claims (both as defined in the
▇▇▇▇▇▇ Plan of Reorganization), shall not be subject to the terms of this
Section 1.17 of this Merger Agreement, but shall be transferred, reconveyed ,
liquidated or distributed, as the case may be, pursuant to Articles 3.3 and 4.1,
and other provisions as applicable, of the ▇▇▇▇▇▇ Plan of Reorganization.
1.18 DISSENTING STOCKHOLDERS OF ▇▇▇▇▇▇. NEWCO agrees that, if and when
the merger contemplated hereby becomes effective, it will promptly pay to any
dissenting stockholder of ▇▇▇▇▇▇ the amount, if any, to which such holder is
entitled under the provisions of Section 262 of the Delaware General Corporation
Law, PROVIDED such dissenter acts in strict compliance with such provisions.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
OF N-VISION
2.1 REPRESENTATIONS AND WARRANTIES OF N-VISION. N-Vision represents and
warrants as follows:
2.1.1 ORGANIZATION AND STANDING. N-Vision is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada, has full requisite corporate power and authority to carry on
its business as it is currently conducted, and to own and operate the properties
currently owned and operated by it, and is duly qualified or licensed to do
business in all jurisdictions in which the character of the properties owned or
the nature of the business conducted by it would make such qualification or
licensing necessary, except where the failure to be so qualified or licensed
would not have a material adverse effect on the financial condition, properties
or business of N-Vision.
2.1.2 AGREEMENT AUTHORIZED AND ITS EFFECT ON OTHER
OBLIGATIONS. Upon approval of this Merger Agreement by the shareholders of
N-Vision, the consummation of the transactions contemplated hereby will have
been duly and validly authorized by all necessary corporate action on the part
of N-Vision, and this Merger Agreement will be a valid and binding obligation of
N-Vision enforceable against N-Vision (subject to normal equitable principles)
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, debtor relief or similar laws affecting
the rights of creditors generally. At the Effective Date, the consummation of
the merger contemplated by this Merger Agreement will not conflict with or
result in a violation or breach of any term or provision of, nor constitute a
default under (i) the certificate of incorporation or bylaws of N-Vision or (ii)
except as set forth herein, any obligation, indenture, mortgage, deed of trust,
lease, contract or other agreement to which N-Vision or any of its subsidiaries
is a party or by which any of them or their properties are bound, other than
such violations, breaches or defaults as would not result in any material
adverse change in the financial condition, properties or businesses of N-Vision
and its subsidiaries taken as a whole.
2.1.3 CAPITALIZATION. The authorized capitalization of
N-Vision consists of -0- shares of preferred stock, of which at September 18,
2000 no shares were issued or outstanding; and 50,000,000 shares of common
stock, par value $.01 per share, of which at September 18, 2000, 8,129,745
shares were issued and outstanding; at the same date, and an additional 400,000
shares were reserved for issuance in conjunction with various warrants issued;
and an additional 600,000 shares were reserved for issuance in conjunction with
various options issued, no shares of N-Vision Common Stock were held in
N-Vision's treasury.
2.1.4 REPORTS AND FINANCIAL STATEMENTS. N-Vision has
previously made available to ▇▇▇▇▇▇ true and complete copies of the consolidated
financial statements of N-Vision's most recent audited financial report which
were prepared in accordance with generally accepted accounting principles
applied on a consistent basis during the periods involved and fairly present the
consolidated financial position for N-Vision and its consolidated subsidiaries
as of the dates thereof and the consolidated results of their operations and
changes in financial position for the periods then ended; and the N-Vision
Report did not contain any untrue statement of the material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
2.1.5 LIABILITIES. N-Vision does not have any liabilities or
obligations, either accrued, absolute, contingent, or otherwise, or have any
knowledge of any potential liabilities or obligations, which would materially
adversely affect the value and conduct of the business of N-Vision, other than
those (i) reflected or reserved against in the December 31, 1999 consolidated
balance sheet of N-Vision, and (ii) incurred in the ordinary course of business
since December 31, 1999.
2.1.6 ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as set
forth herein, other than as a result of the transactions contemplated by this
Merger Agreement, since August 29,2000, there has not been:
2.1.6.1 FINANCIAL CHANGE. Any material adverse change in
the financial condition, backlog, operations, assets, liabilities or business
of N-Vision;
2.1.6.2 PROPERTY DAMAGE. Any material damage, destruction,
or loss to the business or properties of N-Vision (whether or not covered by
insurance);
2.1.6.3 DIVIDENDS. Any declaration, setting aside, or payment
of any dividend or other distribution in respect of the N-Vision Common Stock,
or any direct or indirect redemption, purchase or any other acquisition by
N-Vision of any such stock;
2.1.6.4 CAPITALIZATION CHANGE. Any change in the capital
stock or in the number of shares or classes of N-Vision's authorized or
outstanding capital stock as of August 29, 2000 as described in Paragraph 2.1.3;
2.1.6.5 LABOR DISPUTES. Any labor dispute (other than routine
grievances); or
2.1.6.6 OTHER MATERIAL CHANGES. Any other event or condition
particularly pertaining to and adversely affecting the operations, assets or
business of N-Vision (other than events or conditions which are of a general or
industry-wide nature and of general public knowledge), which would constitute a
material adverse change.
2.1.7 COMPLIANCE WITH OTHER LAWS. N-Vision is not in violation
of or in default with respect to, or in alleged violation of or alleged default
with respect to, any applicable law or any applicable rule, regulation, or any
writ or decree of any court or any governmental commission, board, bureau,
agency, or instrumentality, or delinquent with respect to any report required to
be filed with any governmental commission, board, bureau, agency or
instrumentality, except for violations which, either singly or in the aggregate,
do not and are not expected to result in a material adverse change in the
financial condition, properties or business of N-Vision.
2.1.8 FINDER'S FEE. All negotiations relative to this Merger
Agreement and the transactions contemplated hereby have been carried on by
N-Vision and its counsel directly with ▇▇▇▇▇▇ and its counsel, without the
intervention of any other person as the result of any act of N-Vision and so far
as is known to N-Vision, without the intervention of any person in such manner
as to give rise to any valid claim against any of the parties hereto for a
brokerage commission, finder's fee or any similar payments.
2.1.9 INVESTIGATIONS; LITIGATION. No investigation or review
by any governmental entity with respect to N-Vision or any of the transactions
contemplated by this Merger Agreement is pending or, to best of N-Vision's
knowledge, threatened, nor has any governmental entity indicated to N-Vision an
intention to conduct the same. There is no action, suit or proceeding pending
or, to the best of N-Vision's knowledge, threatened against or affecting
N-Vision at law or in equity, or before any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
which either individually or in the aggregate, does or is likely to result in
any material adverse change in the financial condition, properties or businesses
of N-Vision.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇
3.1 REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇. ▇▇▇▇▇▇ represents and
warrants as follows:
3.1.1 ORGANIZATION AND STANDING. ▇▇▇▇▇▇ is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, has full requisite corporate power subject only to the restrictions
and conditions precedent by the U.S. Bankruptcy Court, the Southern District of
Texas, Corpus Christi Division, under whose jurisdiction the reorganization of
▇▇▇▇▇▇ must receive final approval.
3.1.2 AGREEMENT AUTHORIZED AND ITS EFFECT ON OTHER
OBLIGATIONS. Upon approval of the Plan of Reorganization of ▇▇▇▇▇▇ and
this Merger Agreement by the Bankruptcy Court, the issuance of the
NEWCO Common Stock and the consummation of the transactions
contemplated hereby, having been duly and validly authorized by all
necessary corporate action on the part of ▇▇▇▇▇▇, this Agreement will
be a valid and binding obligation of ▇▇▇▇▇▇ enforceable against ▇▇▇▇▇▇
(subject to normal equitable principles) except as enforceability may
be limited by bankruptcy, reorganization, or similar rights of
creditors generally. At the Effective Date, the consummation of the
merger contemplated by this Merger Agreement, the filing of the
Certificate of Merger and the issuance of the NEWCO Common Stock will
not conflict with or result in a violation or breach of any term or
provision of, nor constitute a default under (i) the Certificate of
Incorporation or Bylaws of ▇▇▇▇▇▇ or (ii) any precedent obligation
imposed by the Bankruptcy Court or any other agreement to which ▇▇▇▇▇▇
or any of its subsidiaries is a party or by which any of them or their
properties are bound, other than such violations, breaches or defaults
as would not result in any material adverse change in the condition, or
standing of ▇▇▇▇▇▇ and its subsidiaries taken as a whole.
3.1.3 CAPITALIZATION. The authorized capitalization of ▇▇▇▇▇▇
consists of 5,000,000 authorized shares of cumulative convertible preferred
stock, $.01 par value, of which no shares were issued and outstanding as of
October 12, 2000; and 50,000,000 shares of common stock, par value $.01 per
share, of which at October 12, 2000, 9,522,540 shares were issued and
outstanding; at the same date, no shares of ▇▇▇▇▇▇ Common Stock were held in
▇▇▇▇▇▇ treasury. All currently issued and outstanding ▇▇▇▇▇▇ warrants and all
issued and outstanding ▇▇▇▇▇▇ options to purchase Common Stock shall have been
terminated in accordance with the terms and provisions of the Reorganization
Plan prior to the merger contemplated hereby.
3.1.4 REPORTS AND FINANCIAL STATEMENTS. ▇▇▇▇▇▇ has previously
made available to N-Vision true and complete copies of (i) all annual reports
filed with the Commission pursuant to the Exchange Act since December 31, 1996,
(ii) ▇▇▇▇▇▇'▇ annual, quarterly, and other reports filed with the Commission
since December 31, 1998, (iii) all definitive proxy solicitation materials filed
with the Commission since December 31, 1996 and (iv) the bankruptcy filing dated
June 15, 1999. The consolidated financial statements of ▇▇▇▇▇▇'▇ most recent
report on Form 10-K (The "▇▇▇▇▇▇ Report") were prepared in accordance with
generally accepted accounting principles applied on a consistent basis during
the periods involved and fairly present the consolidated financial position for
▇▇▇▇▇▇ and its consolidated subsidiaries as of the dates thereof and the
consolidated results of their operations and changes in financial position for
the periods then ended; and the ▇▇▇▇▇▇ Report did not contain any untrue
statements of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
3.1.5 LIABILITIES. Upon receiving approval of its Plan of
Reorganization from the Court, ▇▇▇▇▇▇ will not have any liabilities or
obligations, either accrued, absolute, contingent, joint or several or
otherwise, or have any knowledge of any potential liabilities or obligations of
any kind, which would materially adversely effect the corporate standing of
▇▇▇▇▇▇ or its ability to conduct its business going forward.
3.1.6 ABSENCE OF CERTAIN CHANGES AND EVENTS. Except as set
forth herein, other than as a result of the transactions contemplated by this
Agreement or the bankruptcy reorganization, since the June 15, 1999 bankruptcy
filing there has not been:
3.1.6.1 FINANCIAL CHANGE. Any material adverse change in the
corporate standing of ▇▇▇▇▇▇.
3.1.6.2 PROPERTY DAMAGE. Any material damage, destruction,
or loss to the business or properties of ▇▇▇▇▇▇ (whether or not covered by
insurance) that would effect its corporate standing and the ability to effect
this Merger;
3.1.6.3 DIVIDENDS. Any declaration, setting aside, or payment
of any dividend or other distribution in respect of the common stock of ▇▇▇▇▇▇,
or any direct or indirect redemption, purchase or any other acquisition by
▇▇▇▇▇▇ of any such stock;
3.1.6.4 CAPITALIZATION CHANGE. Any change in the capital
stock or in the number of shares or classes of ▇▇▇▇▇▇'▇ authorized or
outstanding capital stock as described in Paragraph 3.1.3;
3.1.6.5 LABOR DISPUTES. Any labor dispute (other than routine
grievances); or
3.1.6.6 OTHER MATERIAL CHANGES. Any other event or condition
known to ▇▇▇▇▇▇ particularly pertaining to and adversely affecting the
reorganization of ▇▇▇▇▇▇ (other than events or conditions which are of a general
or industry-wide nature and of general public knowledge), which would constitute
a material adverse change.
3.1.7 FINDER'S FEE. All negotiations relative to this Merger
Agreement and the transactions contemplated hereby have been carried on by
▇▇▇▇▇▇ and its counsel directly with N-Vision and its counsel, without the
intervention of any other person as the result of any act of ▇▇▇▇▇▇ and so far
as is known to ▇▇▇▇▇▇, without the intervention of any other person in such
manner as to give rise to any valid claim against any of the parties hereto for
a brokerage commission, finder's fee or any similar payments.
3.1.8 INVESTIGATIONS; LITIGATION. No investigation or review
by any governmental entity with respect to ▇▇▇▇▇▇ or any of the transactions
contemplated by this Merger Agreement is pending or, to the best of ▇▇▇▇▇▇'▇
knowledge, threatened, nor has any governmental entity indicated to ▇▇▇▇▇▇ an
intention to conduct the same. There is no action, suit or proceeding pending
or, to the best of ▇▇▇▇▇▇'▇ knowledge, threatened against or affecting ▇▇▇▇▇▇ at
law or in equity, or before any federal, state, municipal or other governmental
department, commission, board, bureau, agency or is likely to result in any
material adverse change in the financial condition, or corporate standing of
▇▇▇▇▇▇.
ARTICLE IV.
OBLIGATIONS PENDING EFFECTIVE DATE
4.1 AGREEMENTS OF ▇▇▇▇▇▇ AND N-VISION. ▇▇▇▇▇▇ and N-Vision
agrees that from the date hereof to the Effective Date:
4.1.1 MAINTENANCE OF PRESENT BUSINESS. Other than as
contemplated by this Merger Agreement, N-Vision will operate its business only
in the usual, regular, and ordinary manner so as to maintain the goodwill it now
enjoys and, to the extent consistent with such operation, use all reasonable
efforts to preserve intact its present business organization, keep available the
services of its present officers and employees, and preserve its relationships
with customers, suppliers, jobbers, distributors, and other having business
dealings with it;
4.1.2 MAINTENANCE OF PROPERTIES. At its expense, N-Vision
will maintain all of its property and assets in customary repair, order, and
condition, reasonable wear and use and damage by fire or unavoidable casualty
excepted;
4.1.3 MAINTENANCE OF BOOKS AND RECORDS. Both N-Vision and
▇▇▇▇▇▇ will maintain their respective books of account and records in the usual,
regular, and ordinary manner, in accordance with generally accepted accounting
principles applied on a consistent basis or in ▇▇▇▇▇▇'▇ case, that allowed under
applicable law as a result of its bankruptcy filing;
4.1.4 COMPLIANCE WITH LAW. N-Vision and ▇▇▇▇▇▇ will duly
comply in all material respects with all laws applicable to it and to the
conduct of its business; and
4.1.5 INSPECTION OF EACH MERGING CORPORATION. Permit the other
party hereto, and their officers and authorized representatives, during normal
business hours, to inspect its records and to consult with its officers,
employees, attorneys, and agents for the purpose of determining the accuracy of
the representations and warranties hereinabove made and the compliance with
covenants contained in this Merger Agreement. Each agrees that it and its
officers and representatives shall hold all data and information obtained with
respect to the other party hereto in confidence and each further agrees that it
will not use such data or information or disclose the same to others, except to
the extent such data or information either are, or become, published or a matter
of public knowledge.
4.2 ADDITIONAL AGREEMENTS OF ▇▇▇▇▇▇ AND N-VISION. ▇▇▇▇▇▇
and N-Vision agree to take the following actions after the date hereof:
4.2.1 NOTICE OF MATERIAL DEVELOPMENTS. ▇▇▇▇▇▇ and N-Vision
will promptly notify the other party in writing of any "material adverse change"
in, or any changes which, in the aggregate, could result in a "material adverse
change" in, the consolidated financial condition, business or affairs of such
party, whether or not occurring in the ordinary course of business. As used in
this Merger Agreement, the term "material adverse change" means any change,
event, circumstance or condition (collectively, a "change") which when
considered with all other Changes would reasonably be expected to result in a
"loss" having the effect of so fundamentally adversely affecting the business or
financial prospects of NEWCO, as the case may be, that the benefits reasonable
expected to be obtained by such party as a result of the merger contemplated by
this Merger Agreement would be jeopardized with relative certainty. The term
"loss" shall mean any and all direct or indirect payments, obligations,
assessments, losses, loss of income, liabilities, fines, penalties, costs and
expenses paid or incurred or more likely than not to be paid or incurred, or
diminutions in value of any kind of character (whether or not known or unknown,
conditional, or unconditional, ▇▇▇▇▇▇ or inchoate, liquidated or unliquidated,
secured or unsecured, accrued, absolute, contingent or otherwise) that are more
likely than not to occur, including without limitation penalties, interest on
any amount payable to a third party as a result of the foregoing and any legal
or other expenses reasonably incurred or more likely than not to be incurred or
in connection with investigating or defending any demands, claims, actions or
causes of action that, if adversely determined, would likely result in losses,
and all amounts paid in settlement of claims or actions, PROVIDED HOWEVER, that
losses shall be net of any insurance proceeds entitled to be received from a
nonaffiliated insurance company on account of such losses (after taking into
account any costs incurred in obtaining such proceeds and any increase premiums
as a result of a claim with respect to such proceeds). The term "loss" shall not
include losses reported on financial statements prepared in accordance with GAAP
that are consistent with prior reported earnings.
In no event shall a change in the trading price of either the ▇▇▇▇▇▇ Common
Stock or N-Vision Common Stock between the date hereof and the Effective Date,
in and of itself, constitute a material adverse change.
4.2.2 BEST EFFORTS. Upon the terms and subject to the
conditions hereof, and subject to provisions elsewhere herein, the parties
hereto agree to use their reasonable best efforts to take, or cause to be taken,
all appropriate action, and to do, or cause to be done, all things necessary,
proper or advisable to consummate and make effective the transactions
contemplated by this Agreement and to cooperate in connection with the
foregoing, including using reasonable best efforts (i) to obtain any necessary
waivers, consents and approvals from other parties to material notes, licenses,
agreements, and other instruments and obligations; (ii) to obtain any material
consents, approvals, authorizations and permits required to be obtained under
any federal, state or local statute, rule or regulation; (iii) to defend all
lawsuits or other legal proceedings challenging this Merger Agreement or the
consummation of the transactions contemplated hereby; and (iv) promptly to
effect all necessary filings and notifications. In addition, N-Vision agrees to
use its reasonable best efforts to obtain a written confirmation of the oral
fairness opinion it has received from an independent investment advisor/banker
(the "Fairness Opinion") that, as of the date of such opinion, this Agreement
and the exchange ratio in the merger are fair, from a financial point of view,
to the holders of N-Vision Common Stock. In case at any time after the Effective
Date any further action is necessary or desirable to carry out the purposes of
this Agreement, the proper officers and directors or the Surviving Corporation
on behalf of N-Vision and ▇▇▇▇▇▇ shall take all such action.
4.3 ADDITIONAL AGREEMENTS OF N-VISION. N-Vision agrees that
from the date hereof to the Effective Date, it will:
4.3.1 DISPOSAL OF ASSETS. Not sell, dispose of, or encumber,
any property or assets, except (i) in the ordinary course of business or (ii)
as is otherwise agreed to in writing by ▇▇▇▇▇▇.
4.3.2 MAINTENANCE OF INSURANCE. Maintain insurance upon all
its properties and with respect to the conduct of its business of such kinds and
in such amount as is customary in the type of business in which it is engaged,
but not less than that presently carried by it, which insurance may be added to
from time to time in its discretion; PROVIDED, that if during the period from
the date hereof to and including the Effective Date any of its property or
assets are damaged or destroyed by fire or other casualty, the obligations under
this Agreement shall not be affected thereby (subject, however, to the provision
that the coverage limits of such policies are adequate in amount to cover the
replacement value of such property or assets and loss of profits during
replacement, less commercially reasonable deductible, if of material
significance to the assets or operations of N-Vision but it shall promptly
notify ▇▇▇▇▇▇ in writing thereof and proceed with the repair or restoration of
such property or assets in such manner and to such extent as may be approved by
▇▇▇▇▇▇ and upon the Effective Date all proceeds of insurance and claims of every
kind arising as a result of any such damage or destruction shall remain the
property of Surviving Corporation;
4.3.3 NO AMENDMENT TO CERTIFICATE OF INCORPORATION,
ETC. Not amend its certificate of incorporation or bylaws or other
organizational documents or merge or consolidate with or into any other
corporation or change in any manner the rights of its capital stock or the
character of its business;
4.3.4 PROHIBITION ON DIVIDENDS. Not declare or pay any
dividend on shares of its capital stock or make any other distribution of assets
to the holders thereof;
4.3.5 STOCKHOLDER'S MEETING. Promptly call and hold a
meeting of stockholders for the purpose of considering and acting upon
proposals to approve the merger contemplated by this Agreement.
4.3.6. NO SOLICITATION. Not directly or indirectly authorize
or permit any of its respective agents to: (i) solicit, initiate, encourage,
(including by way of furnishing information) or take any other action to
facilitate, any inquiry or the making of any proposal which constitutes, or may
reasonably be expected to lead to, any acquisition or purchase of a substantial
amount of assets of, or any equity interest in N-Vision, or any merger,
consolidation, business combination, sale of securities, recapitalization,
liquidation, dissolution or similar transaction involving (other than the
transactions contemplated by this Agreement) or any other material corporate
transaction the consummation of which would or could reasonably be expected to
impede, interfere with, prevent or materially delay the merger contemplated by
this Agreement (collectively, "Transaction Proposals") or agree to or endorse
any Transaction Proposal or (ii) propose, enter into or participate in any
discussions or negotiations regarding any of the foregoing.
4.4 ADDITIONAL AGREEMENTS OF ▇▇▇▇▇▇. ▇▇▇▇▇▇ agrees that from the date
hereof to the Effective Date, it will:
4.4.1 PLAN OF REORGANIZATION. Seek approval of a plan of
reorganization for the purpose of considering and effecting (i) approval of the
merger contemplated by this Agreement, (ii) ratifying the change in the board of
directors as provided in Paragraph 1.7, and (iii) authorizing the issuance of
the NEWCO Common Stock to be issued to N-Vision stockholders as described in
Paragraph 1.12 above.
4.4.2 DIRECTORS AND OFFICERS INSURANCE. At or prior to the
Effective Date, ▇▇▇▇▇▇ will either (i) provide evidence that it has directors
and officers coverage for the present officers of N-Vision in respect to claims
made for acts and/or omissions prior to the Effective Date, which coverage shall
be the same as, or equivalent to, the coverage then in existence and
provided to the directors and officers of NEWCO, or (ii) provide indemnification
by the Estate of ▇▇▇▇▇▇ against any and all such claims.
4.4.3. NO SOLICITATION. Not directly or indirectly
authorize or permit any of its respective agents to: (i) solicit, initiate,
encourage, (including by way of furnishing information) or take any other action
to facilitate, any inquiry or the making of any proposal which constitutes, or
may reasonably be expected to lead to, any acquisition or purchase of a
substantial amount of equity interest in ▇▇▇▇▇▇, or any merger, consolidation,
business combination, sale of securities, recapitalization, liquidation,
dissolution or similar transaction involving (other than the transactions
contemplated by this Merger Agreement and ▇▇▇▇▇▇'▇ Plan of Reorganization) or
any other material corporate transaction the consummation of which would or
could reasonably be expected to impede, interfere with, prevent or materially
delay the merger contemplated by this Merger Agreement (collectively,
"Transaction Proposals") or agree to or endorse any Transaction Proposal or
(ii) propose, enter into or participate in any discussions or negotiations
regarding any of the foregoing.
ARTICLE V.
CONDITIONS PRECEDENT TO OBLIGATIONS
5.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF N-VISION. The
obligations of N-Vision to consummate and effect the merger hereunder shall be
subject to the satisfaction of the following conditions, or to the waiver
thereof by N-Vision in the manner contemplated by Paragraph 6.4 before the
Effective Date:
5.1.1 REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇ TRUE AT
EFFECTIVE DATE. The representations and warranties of ▇▇▇▇▇▇ herein contained
shall be, in all material respects, true as of and at the Effective Date with
the same effect as though made at such date, except as affected by transactions
permitted or contemplated by this Merger Agreement; ▇▇▇▇▇▇ shall have performed
and complied, in all material respects, with all covenants required by this
Agreement to be performed or complied with by ▇▇▇▇▇▇ before the Effective Date.
5.1.2 NO MATERIAL LITIGATION. No suit, action, or other
proceeding shall be pending, or to ▇▇▇▇▇▇'▇ knowledge, threatened, before any
court or governmental agency in which it will be, or it is, sought to restrain
or prohibit or to obtain damages or other relief in connection with this
Agreement or the consummation of the merger contemplated hereby or which might
result in a material adverse change in the corporate standing of ▇▇▇▇▇▇.
5.1.3 APPROVAL OF THE PLAN OF REORGANIZATION The approval of
the Bankruptcy Court with respect to the Plan or Reorganization and Merger
contemplated by this Merger Agreement, and such approval shall not have been
amended, modified or rescinded on or before the Effective Date.
5.1.4 UNEXERCISED ▇▇▇▇▇▇ WARRANTS AND OPTIONS. NEWCO shall not
assume any obligations with respect to ▇▇▇▇▇▇'▇ previously issued rights and
obligations with respect to any outstanding options or warrants nor will it be
obligated to substitute NEWCO options for such options. All currently issued and
outstanding ▇▇▇▇▇▇ warrants and all issued and outstanding ▇▇▇▇▇▇ options to
purchase Common Stock shall have been terminated in accordance with the terms
and provisions of the Plan of Reorganization prior to the merger contemplated
hereby.
5.1.5 WAIVER OF ANTI-DILUTION ADJUSTMENT. All persons entitled
to receive, as a result of the transactions contemplated hereby, issuance of
▇▇▇▇▇▇ Common Stock after the date hereof will have waived all of their rights
to receive such ▇▇▇▇▇▇ Common Stock, except as provided for certain parties
under ▇▇▇▇▇▇'▇ Plan of Reorganization.
5.2 CONDITIONS PRECEDENT TO OBLIGATIONS OF ▇▇▇▇▇▇. The
obligations of ▇▇▇▇▇▇ to consummate and effect the merger hereunder shall be
subject to the satisfaction of the following conditions, or to the waiver
thereof by ▇▇▇▇▇▇ in the manner contemplated by Paragraph 6.4 before the
Effective Date or closing date.
5.2.1 REPRESENTATIONS AND WARRANTIES OF N-VISION TRUE AT
EFFECTIVE DATE. The representations and warranties of N-Vision herein contained
shall be, in all material respects, true as of and at the Effective Date with
the same effect as though made at such date, except as affected by transactions
permitted or contemplated by this Merger Agreement; N-Vision shall have
performed and complied, in all material respects, with all covenants required by
this Agreement to be performed or complied with by it before the Effective Date.
5.2.2 NO MATERIAL LITIGATION. No suit, action, or other
proceeding shall be pending, or N-Vision's knowledge, threatened, before any
court or governmental agency in which it will be, or it is, sought to restrain
or prohibit or to obtain damages or other relief in connection with this Merger
Agreement or the consummation of the merger contemplated hereby or which might
result in a material adverse change in the value of the assets and business of
N-Vision.
5.2.3 STOCKHOLDER APPROVAL. At the meeting of stockholders of
N-Vision to be held before the Effective Date, the holders of the requisite
majority of the outstanding shares of N-Vision Common stock shall have approved
the merger contemplated by this Merger Agreement.
5.2.4 CONSENT OF CERTAIN PARTIES IN PRIVITY WITH N-VISION. The
holders of any material indebtedness of N-Vision, the lessors of any material
property leased by N-Vision, and the other parties to any other material
agreements to which N-Vision is a party shall, when and to the extent required,
have consented to the merger contemplated hereby.
ARTICLE VI.
TERMINATION AND ABANDONMENT
6.1 TERMINATION. Anything contained in this Merger Agreement to the
contrary notwithstanding, this Agreement may be terminated and the merger
contemplated hereby abandoned at any time (whether before or after the approval
and adoption thereof by N-Vision or ▇▇▇▇▇▇) before the Effective Date:
6.1.1 BY MUTUAL CONSENT. By mutual consent of ▇▇▇▇▇▇ and N-Vision.
6.1.2 BY ▇▇▇▇▇▇ BECAUSE OF CONDITIONS PRECEDENT. By ▇▇▇▇▇▇, if any
condition set forth in Paragraph 5.2 hereof has not been met and has not been
waived.
6.1.3 BY ▇▇▇▇▇▇ BECAUSE OF MATERIAL ADVERSE CHANGE. By ▇▇▇▇▇▇, if there has
been a material adverse change in the financial condition or business of
N-Vision since the date of financial statements contained in the most recent
Report referred to in Paragraph 2.1.4.
6.1.4 BY N-VISION BECAUSE OF CONDITIONS PRECEDENT. By N-Vision, if any
condition set forth in Paragraph 5.1 hereof has not been met and has not been
waived.
6.1.5 BY N-VISION BECAUSE OF MATERIAL ADVERSE CHANGE. By N-Vision, if there
has been a material adverse change in the corporate standing or the Plan of
Reorganization of ▇▇▇▇▇▇ since the date of filing of same with the Bankruptcy
Court.
6.1.6 BY ▇▇▇▇▇▇ OR N-VISION BECAUSE OF LEGAL PROCEEDINGS. By either ▇▇▇▇▇▇
or N-Vision if any suit, action, or other proceeding shall be pending or
threatened by the federal or a state government before any court or governmental
agency, in which it is sought to restrain, prohibit, or otherwise affect the
consummation of the merger contemplated hereby, except by those parties to
▇▇▇▇▇▇'▇ Bankruptcy Case who seek to object to, or motion for denial of,
confirmation of the Plan of Reorganization.
6.1.7 BY N-VISION OR ▇▇▇▇▇▇ IF ▇▇▇▇▇▇ PLAN OF REORGANIZATION
IS NOT CONFIRMED BY NOVEMBER 30, 2000. By N-Vision or ▇▇▇▇▇▇, if the ▇▇▇▇▇▇ Plan
of Reorganization, as modified or amended as the case may be, contemplating such
Merger Agreement, shall not have become confirmed by entry of an order of the
Bankruptcy Court on or before November 30, 2000, provided however that ▇▇▇▇▇▇ or
N-Vision at its sole discretion may terminate this Merger Agreement upon the
filing by any party of a notice of appeal of the order confirming the ▇▇▇▇▇▇
Plan of Reorganization, provided further that such party filing an appeal
obtains a stay of the order confirming the Plan of Reorganization.
6.1.8 BY ▇▇▇▇▇▇ OR N-VISION BECAUSE OF DUE DILIGENCE. By
▇▇▇▇▇▇ or N-Vision if in the course of completing their inspections pursuant to
Paragraph 4.1.5, information is discovered that would constitute a material
adverse change as that term is defined in Paragraph 4.2.2 .
6.2 TERMINATION BY BOARD OF DIRECTORS. An election of N-Vision
to terminate this Merger Agreement and abandon the merger pursuant to those
reasons provided in Paragraph 6.1 shall be exercised of behalf of N-Vision by
its board of directors. An election of ▇▇▇▇▇▇ to terminate this Merger Agreement
and abandon the merger pursuant to those reasons provided in Paragraph 6.1 shall
be exercised of behalf of ▇▇▇▇▇▇ by its board of directors or by order of the
Bankruptcy Court.
6.3 EFFECT OF TERMINATION. In the event of the termination and
abandonment of this Merger Agreement pursuant to and in accordance with the
provisions of Paragraph 6.1 hereof, this Agreement shall become void and have no
effect, without any liability on the part of any party hereto (or its
stockholders or controlling persons or directors or officers), except as
otherwise provided in this Agreement; PROVIDED,HOWEVER, that no party hereto
shall waive any term or condition hereof, unless in the judgment of the board of
directors taking the action, such waiver will not have a materially adverse
effect on the benefits intended under this Merger Agreement to the stockholders
of its corporation.
6.4 WAIVER OF CONDITIONS. Subject to the requirements of any
applicable law, any of the terms or conditions of this Agreement may be waived
at any time by the party which is entitled to the benefit thereof, by action
taken by its board of directors, the executive committee of its board of
directors, or its chief executive officer.
6.5 EXPENSES ON TERMINATION. Except as provided in Sections
6.5.1, if the merger contemplated hereby is abandoned pursuant to and in
accordance with the provisions of Paragraph 6.1 hereof, all expenses not
provided for in Section 6.5.1, will be paid by the party incurring them.
6.5.1 PAYMENT OF FEES TO COUNSEL FOR ▇▇▇▇▇▇ As provided in a
certain Letter Agreement Dated January 25, 2000, N-Vision has tendered a
retainer fee of $ 50,000 to counsel for ▇▇▇▇▇▇. Said retainer will be used to
pay the expenses associated with filing the Plan of Reorganization and Merger
with the Court. Counsel has agreed to cap the expenses at $50,000 and return any
unused portion of the retainer upon completion of the proposed transaction.
ARTICLE VII.
ADDITIONAL AGREEMENTS
7.1 INDEMNIFICATION BY N-VISION. N-Vision agrees to indemnify and hold
harmless ▇▇▇▇▇▇ and its officers and directors and each person who controls
▇▇▇▇▇▇ within the meaning of Section 15 of the Securities Act or Section 20 of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") against any
and all losses, claims, damages, or liabilities, joint or several, to which any
of them may become subject under the Securities Act, the Exchange Act or any
other statute or common law, and to reimburse them for any legal or other
expenses incurred by them in connection with investigating any claims and
defending any actions, to the extent such losses, claims, damages, liabilities,
or actions arise out of or are based upon (i) an false, misleading or untrue
statement or alleged false, misleading or untrue statement of a material fact,
insofar as it relates to N-Vision contained in the Merger Agreement as presented
to the Court as part of the Reorganization or (ii) the omission or alleged
omission to state in the Merger Agreement a material fact required to be stated
therein or necessary to make the statements therein not misleading, and insofar
as the same relates to N-Vision.
7.2 INDEMNIFICATION BY ▇▇▇▇▇▇. ▇▇▇▇▇▇ agrees to indemnify and hold
harmless N-Vision and it officers and directors and each person who controls
N-Vision within the meaning of Section 15 of the Securities Act or Section 20 of
the Securities Exchange Act against any and all losses, claims, damages, or
liabilities, joint or several, to which any of them may become subject under the
Securities Act, the Exchange Act or any other statute or common law, and to
reimburse them for any legal or other expenses incurred by them in connection
with investigating any claims and defending any actions, to the extent such
losses, claims, damages, liabilities, or actions arise out of or are based upon
(i) an false, misleading or untrue statement or alleged false, misleading or
untrue statement of a material fact, insofar as it relates to ▇▇▇▇▇▇ contained
in the Plan of Reorganization and / or the Merger Agreement as presented to the
Court as part of the Reorganization or (ii) the omission or alleged omission to
state in the Plan of Reorganization and / or the Merger Agreement, a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and insofar as the same relates to ▇▇▇▇▇▇.
ARTICLE VIII.
MISCELLANEOUS
8.1 ENTIRETY. This Agreement and the Confidentiality Agreements dated
January 25, 2000 between ▇▇▇▇▇▇ and N-Vision embody the entire agreement between
the parties with respect to the subject matter hereof, and all prior agreements
between the parties with respect thereto are hereby superseded in their
entirety.
8.2 COUNTERPARTS. Any number of counterparts of this Merger Agreement
may be executed and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
instrument.
8.3 NOTICE AND WAIVERS. Any notice or waiver to be given to any party hereto
shall be in writing and shall be delivered by courier, sent by facsimile
transmission or first class registered or certified mail, postage prepaid.
IF TO ▇▇▇▇▇▇
▇▇▇▇▇▇ Industries, Inc.
▇/▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇, ▇.▇.
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
IF TO N-VISION
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Chairman and CEO
N-Vision Technology, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Facsimile (▇▇▇) ▇▇▇-▇▇▇▇
Any communication so addressed and mailed by first-class registered or
certified mail, postage prepaid, shall be deemed to have been received on the
third business day after so mailed, and if delivered by courier or facsimile to
such address, upon delivery during normal business hours on any business day.
8.4 TERMINATION OF REPRESENTATIONS, WARRANTIES, ETC. The respective
representations and warranties contained in Articles II and III shall expire
with, and be terminated and extinguished by, the merger pursuant to this Merger
Agreement at the time of the consummation thereof on the Effective Date. This
Paragraph 8.4 shall have no effect upon any other right or obligation of the
parties in connection with this Merger Agreement or otherwise, whether to be
exercised or performed before or after the Effective Date.
8.5 TABLE OF CONTENTS AND CAPTIONS. The table of contents and captions
contained in this Merger Agreement are solely for convenient reference and shall
not be deemed to affect the meaning or interpretation of any article, section,
or paragraph hereof.
8.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of and be enforceable by the successors and assigns
of the parties hereto.
8.7 SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void,
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions shall remain in full force and effect and shall in no way be
affected, impaired or invalidated. It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such which may
be hereafter declared invalid, void or unenforceable.
8.8 APPLICABLE LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Texas (except to the
extent that the form and content of the Certificate of Merger and the
consequences of the filing thereof shall be governed by the general corporation
law of the State of Delaware).
8.9 PUBLIC ANNOUNCEMENTS. The parties agree that before the Effective
Date that they shall consult with each other before the making of any public
announcement regarding the existence of this Agreement, the contents hereof or
the transactions contemplated hereby, and to obtain the prior approval of the
other party as to the content of such announcement, which approval shall not be
unreasonably withheld. However, the foregoing shall not apply to any
announcement or written statement which, upon the written advice of counsel, is
required by law to be made, except that the party required to make such
announcement shall, whenever practicable, consult with and solicit prior
approval from such other party concerning the timing and content of such legally
required announcement or statement before it is made.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed in their respective corporate names by their respective corporate names
by their respective duly authorized representatives, all as of the day and year
first above written.
THE PARTIES TO THE MERGER CONTEMPLATED BY THIS MERGER AGREEMENT:
▇▇▇▇▇▇ INDUSTRIES, INC.
------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chairman of the Board and President
----------------
DATE
-and-
N-VISION TECHNOLOGY, INC.
------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Chairman of the Board and
Chief Executive Officer
----------------
DATE