EXHIBIT 10.1
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PLAN AND AGREEMENT TO EXCHANGE STOCK
by and among
RAINWIRE PARTNERS, INC.,
OASIS GROUP, INC.
and
SHAREHOLDERS OF OASIS GROUP, INC.
Dated as of August 29, 2001
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Table of Contents
Page
ARTICLE I
THE SHARE EXCHANGE
Section 1.01. The Share Exchange..............................................1
Section 1.02. Time and Place of Closing.......................................1
Section 1.03. Effective Time..................................................1
Section 1.04. Amendment to Certificate of Incorporation.......................2
ARTICLE II
MANNER OF CONVERTING SHARES
Section 2.01. Share Exchange Consideration....................................2
Section 2.02. Conversion of Shares............................................2
Section 2.03. Adjustments to Exchange Ratio...................................3
Section 2.04. Shares Held by Oasis............................................3
Section 2.05. Fractional Shares...............................................3
ARTICLE III
EXCHANGE OF SHARES
Section 3.01. Exchange Agent..................................................3
Section 3.02. Instructions to Exchange Agent..................................3
Section 3.03. Exchange Procedures.............................................3
Section 3.04. Rights of Former Oasis Owners...................................4
Section 3.05. No Further Ownership Rights in Oasis Stock......................4
Section 3.06. No Liability....................................................4
Section 3.07. Lost Certificates...............................................4
Section 3.08. Withholding Rights..............................................4
Section 3.09. Further Assurances..............................................5
Section 3.10. No Fractional Shares............................................5
ARTICLE IV
FURTHER TERMS AND COVENANTS
Section 4.01. Delivery of Investment Representation Letters...................5
Section 4.02. [Reserved]......................................................5
Section 4.03. Oasis Shareholder Approval......................................5
Section 4.04. Rainwire Shareholder Approval...................................5
Section 4.05. [Reserved]......................................................5
Section 4.06. New Directors...................................................5
Section 4.07. Conversion of Note..............................................5
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF Oasis
Section 5.01. Organization, Authority and Capacity............................6
Section 5.02. Authorization and Validity......................................6
Section 5.03. Absence of Conflicting Agreements or Required Consents..........6
Section 5.04. Governing Documents of Oasis....................................6
Section 5.05. Outstanding and Authorized Capitalization.......................7
Section 5.06. Financial Statements............................................7
Section 5.07. Absence of Changes..............................................7
Section 5.08. No Undisclosed Liabilities.....................................10
Section 5.09. Litigation, Etc................................................10
Section 5.10. No Violation of Law............................................10
Section 5.11. Real and Personal Property.....................................10
Section 5.12. Contracts and Commitments......................................11
Section 5.13. Employment and Labor Matters...................................13
Section 5.14. Employee Benefit Matters.......................................13
Section 5.15. Insurance Policies.............................................14
Section 5.16. Taxes..........................................................14
Section 5.17. Interested Transactions........................................15
Section 5.18. Intellectual Property..........................................15
Section 5.19. Required Vote of Oasis Shareholders............................15
Section 5.20. Brokerage......................................................16
Section 5.21. Statements True and Correct....................................16
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF RAINWIRE
Section 6.01. Organization, Authority and Capacity...........................16
Section 6.02. Authorization and Validity.....................................16
Section 6.03. Absence of Conflicting Agreements or Required Consents.........16
Section 6.04. Governing Documents............................................17
Section 6.05. Outstanding and Authorized Capitalization......................17
Section 6.06. Reports and Financial Statements...............................17
Section 6.07. Absence of Changes.............................................18
Section 6.08. No Undisclosed Liabilities.....................................20
Section 6.09. Litigation, Etc................................................20
Section 6.10. No Violation of Law............................................21
Section 6.11. Real and Personal Property.....................................21
Section 6.12. Contracts and Commitments......................................21
Section 6.13. Employment and Labor Matters...................................23
Section 6.14. Employee Benefit Matters.......................................24
Section 6.15. Insurance Policies.............................................25
Section 6.16. Taxes..........................................................25
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Section 6.17. Interested Transactions........................................25
Section 6.18. Intellectual Property..........................................26
Section 6.19. Brokerage......................................................26
Section 6.20. Subsidiaries...................................................26
Section 6.21. Statements True and Correct....................................26
ARTICLE VII
ADDITIONAL AGREEMENTS
Section 7.01. Access to Information..........................................27
Section 7.02. No-Shop........................................................27
Section 7.03. Affirmative Covenants of Oasis.................................28
Section 7.04. Negative Covenants of Oasis....................................29
Section 7.05. Affirmative Covenants of Rainwire..............................31
Section 7.06. Negative Covenants of Rainwire.................................31
Section 7.07. Confidentiality................................................31
Section 7.08. Public Announcements...........................................32
Section 7.09. Filings with State Offices.....................................32
Section 7.10. Conditions to Closing..........................................32
Section 7.11. Sale of Shares.................................................32
Section 7.12. [Reserved].....................................................33
Section 7.13. [Reserved].....................................................33
ARTICLE VIII
CONDITIONS TO OBLIGATIONS OF Rainwire
Section 8.01. Representations and Warranties.................................33
Section 8.02. Performance; Covenants.........................................33
Section 8.03. Necessary Consents and Approvals...............................34
Section 8.04. No Material Adverse Change.....................................34
Section 8.05. No Injunction, Etc.............................................34
Section 8.06. Investor Representation Letters................................34
Section 8.07. Oasis Shareholder Approval.....................................34
Section 8.08. [Reserved].....................................................34
Section 8.09. Certificate of Share Exchange..................................34
Section 8.10. Tax-Free Share Exchange........................................35
Section 8.11. Evidence of Compliance with Securities Laws....................35
ARTICLE IX
CONDITIONS TO OBLIGATIONS OF Oasis AND Oasis SHAREHOLDERS
Section 9.01. Representations and Warranties.................................35
Section 9.02. Performance; Covenants.........................................35
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Section 9.03. Necessary Consents and Approvals...............................35
Section 9.04. No Material Adverse Change.....................................36
Section 9.05. No Injunction, Etc.............................................36
Section 9.06. Securities Filings.............................................36
Section 9.07. Certificate of Share Exchange..................................36
Section 9.08. Tax-Free Share Exchange........................................36
Section 9.09. Employment Agreements..........................................36
Section 9.10. Rainwire Shareholder Approval..................................36
ARTICLE X
TERMINATION
Section 10.01. Right of Termination...........................................36
Section 10.02. Effect of Termination..........................................37
ARTICLE XI
SURVIVAL OF TERMS; INDEMNIFICATION
Section 11.01. Indemnification by Rainwire....................................37
Section 11.02. Indemnification by Oasis and the Oasis Shareholders............38
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Notices........................................................38
Section 12.02. Expenses.......................................................38
Section 12.03. Further Assurances.............................................39
Section 12.04. Waiver.........................................................39
Section 12.05. Assignment.....................................................39
Section 12.06. Binding Effect.................................................39
Section 12.07. Headings.......................................................39
Section 12.08. Entire Agreement...............................................39
Section 12.09. Governing Law; Severability....................................39
Section 12.10. Counterparts...................................................39
Section 12.11. Brokers and Finders............................................40
Section 12.12. Schedules and Exhibits.........................................40
Section 12.13. Enforcement of Agreement.......................................40
ARTICLE XIII
CERTAIN DEFINITIONS..................................................................40
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PLAN AND AGREEMENT TO EXCHANGE STOCK
THIS PLAN AND AGREEMENT TO EXCHANGE STOCK (this "Agreement") is made
and entered into as of August 29, 2001, by and among RAINWIRE PARTNERS, INC., a
Delaware corporation ("Rainwire"), and OASIS GROUP, INC., a Georgia corporation
("Oasis"), and the SHAREHOLDERS OF OASIS, all of whom are listed on Schedule 1
(collectively, the "Oasis Shareholders").
WHEREAS, Oasis, Rainwire, and the Oasis Shareholders intend to effect a
reorganization pursuant to Section 368(a)(1)(B) of the Code (as hereinafter
defined) whereby Rainwire will acquire all of the outstanding shares of stock of
Oasis from the Oasis Shareholders in exchange for newly issued shares of common
stock of Rainwire.
NOW, THEREFORE, for and in consideration of these premises and the
mutual covenants, promises, agreements, representations and warranties set forth
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, Rainwire, Oasis and the Oasis Shareholders
hereby agree as follows:
ARTICLE I
THE SHARE EXCHANGE
SECTION 1.01 THE SHARE EXCHANGE. Upon the terms and subject to the
conditions set forth in this Agreement, and in accordance with the Georgia
Business Corporation Code ("GBCC") and the General Corporation Law of the State
of Delaware ("GCDL"), Rainwire will acquire all of the outstanding shares of
stock of Oasis from the Oasis Shareholders in exchange for validly issued, fully
paid and nonassessable shares of common stock of Rainwire, and, after giving
effect to all of the transactions contemplated by this Agreement, (a) the
Rainwire shareholders and the Oasis Shareholders will jointly own all of the
issued and outstanding shares of Rainwire and (b) Oasis will be a wholly-owned
subsidiary of Rainwire (the "Share Exchange").
SECTION 1.02 TIME AND PLACE OF CLOSING. The "Closing" shall mean the
consummation of the exchange of Rainwire Shares and the Oasis Shares, as set
forth in Article III, as well as the consummation of any other transactions
which are contemplated by this Agreement to occur at Closing. Closing shall take
place no later than within three business days following the date upon which all
of the conditions precedent contained in Articles VIII and IX of this Agreement
have occurred and all regulatory matters have been complied with, at 10:00 a.m.,
local time, at the offices of ▇▇▇▇▇ ▇▇▇▇, LLP, Suite 2100, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇.▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other time and place as the parties may
agree in writing. The date the Closing actually occurs is the "Closing Date."
SECTION 1.03 EFFECTIVE TIME. Subject to the provisions of this
Agreement, the parties shall file a Certificate of Share Exchange in such form
as is required by, and executed in accordance with, the relevant provisions of
the GBCC, including ss. 14-2-1105, and shall make all other filings or
recordings required under the GBCC as soon as practicable on or after the
Closing
Date. The Share Exchange and other transactions contemplated by this Agreement
shall become effective on the date and at the time the Certificate of Share
Exchange reflecting the Share Exchange is duly filed with the Secretary of State
of the State of Georgia, or at such other time and date as Oasis, Rainwire, and
the Oasis Shareholders shall agree and as specified in the Certificate of Share
Exchange (the "Effective Time").
SECTION 1.04 AMENDMENT TO CERTIFICATE OF INCORPORATION. Prior to the
Closing, Rainwire will effect a twenty-for-one reverse split of its authorized
and outstanding common stock so that Rainwire will have approximately 1,000,000
shares of authorized common stock after the Reverse split (the "Reverse Split"),
and after the Reverse Split shall amend its Amended and Restated Certificate of
Incorporation to increase its authorized shares of common stock to 100,000,000
(the "Amendment"). Rainwire shall use its best efforts to obtain the written
consent of the majority of the Rainwire Shareholders in favor of the Reverse
Split and Amendment, and shall timely comply with all applicable state and
federal laws in connection with the shareholder consent, including the filing
and mailing of a Schedule 14C pursuant to the Securities Exchange Act of 1934 to
all shareholders as of the record date that did not provide Rainwire with their
written consent to the Reverse Split and Amendment.
ARTICLE II
MANNER OF CONVERTING SHARES
SECTION 2.01 SHARE EXCHANGE CONSIDERATION. Upon the terms and subject
to the conditions of this Agreement, the Oasis Shareholders shall receive, as
consideration for the Share Exchange of all of the issued and outstanding shares
of Oasis's Common Stock, no par value ("Oasis Common Stock"), shares of the
Common Stock, par value $.001, of Rainwire ("Rainwire Common Stock"), such
shares of Rainwire Common Stock to be issuable at the Closing in accordance with
the terms of this Agreement. At the Effective Time, all such shares of Rainwire
Common Stock shall be duly and validly issued, fully paid and nonassessable.
SECTION 2.02 CONVERSION OF SHARES. Subject to the provisions of this
Article II, at the Effective Time, by virtue of the Share Exchange and without
any action on the part of the parties hereto or the shareholders of any of the
parties, each share of Oasis Common Stock issued and outstanding at the
Effective Time shall, by virtue of the Share Exchange and without any action on
the part of the holder thereof, automatically be converted into that number of
shares of Rainwire Common Stock as shall be obtained by dividing (a) 19,418,000
(the "Share Exchange Consideration") by (b) the number of Fully Diluted Shares
(as hereinafter defined), with the resulting quotient (carried to four decimal
places) being referred to herein as the "Exchange Ratio." "Fully Diluted Shares"
shall be equal to the total number of outstanding shares of Oasis Common Stock
calculated on a fully diluted, fully converted basis as though any and all
convertible debt and equity securities (including any Oasis Preferred Stock and
any outstanding warrants and outstanding options (whether vested or unvested))
had been converted or exercised into Common Stock. The Exchange Ratio shall not
change as a result of fluctuations in the market price of Rainwire Common Stock
between the date of this Agreement and the Effective Time. The aggregate number
of shares of Rainwire Common Stock issued pursuant to this Section 2.02 shall be
referred to as "Share Exchange Shares."
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SECTION 2.03 ADJUSTMENTS TO EXCHANGE RATIO. The Exchange Ratio shall be
equitably adjusted to reflect fully the effect of any stock split, reverse
split, stock dividend (including any dividend or distribution of securities
convertible into Rainwire Common Stock or Oasis Common Stock), reorganization,
recapitalization or other like change with respect to Rainwire Common Stock or
Oasis Common Stock occurring after the date of this Agreement and prior to the
Effective Time. Any such change for which a record date is established shall be
deemed for the purposes of this Section 2.03 to have occurred on the record
date. Notwithstanding the foregoing, the Exchange Ratio shall not be adjusted
for any effects that the Stock Dividend and Amendment shall have on the Rainwire
Common Stock.
SECTION 2.04 SHARES HELD BY OASIS. Each share of Oasis Common Stock
held in treasury by Oasis, shall be canceled and retired at the Effective Time,
and no consideration shall be issued in exchange therefor.
SECTION 2.05 FRACTIONAL SHARES. No certificates representing fractional
shares of Rainwire Common Stock will be issued as a result of the Share
Exchange. Any fractional share interest to which an Exchanging Shareholder would
otherwise be entitled to receive shall be rounded up to the nearest whole share
if such fraction is 0.5 or greater and shall be rounded down to the nearest
whole share if such fraction is less than 0.5.
ARTICLE III
EXCHANGE OF SHARES
SECTION 3.01 EXCHANGE AGENT. Rainwire's transfer agent shall serve as
the exchange agent (the "Exchange Agent") in the Share Exchange.
SECTION 3.02 INSTRUCTIONS TO EXCHANGE AGENT. At or prior to the
Effective Time, Rainwire shall give instructions to the Exchange Agent
concerning the issuance of such certificates representing the aggregate number
of shares of Rainwire Common Stock issuable pursuant to Section 2.02 in exchange
for outstanding shares of Oasis Common Stock.
SECTION 3.03 EXCHANGE PROCEDURES. Upon surrender of a certificate for
cancellation to the Exchange Agent, together with a letter of transmittal, duly
executed, and such other documents as may reasonably be required by the Exchange
Agent, the holder of such certificate shall be entitled to receive in exchange
therefor a Rainwire certificate representing that number of whole shares of
Rainwire Common Stock that such holder has the right to receive pursuant to the
provisions of this Article III, and the certificate so surrendered shall
forthwith be cancelled. Until surrendered as contemplated by this Section 3.03,
each certificate shall be deemed at any time after the Effective Time to
represent only the right to receive upon such surrender the Share Exchange
Consideration that the holder thereof has right to receive pursuant to the
provisions of this Article III. No interest will be paid or will accrue on any
cash payable to holders of certificates pursuant to the provisions of this
Article.
Rainwire shall not be obligated to deliver the consideration to which
any Exchanging Shareholder is entitled as a result of the Share Exchange until
such holder surrenders his or her
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certificate or certificates representing the shares of Oasis Common Stock for
exchange as provided in this Article III or such holder provides an appropriate
affidavit regarding loss of such certificate or agreement and an indemnification
in favor of Rainwire pursuant to Section 3.07 hereof. All certificates
representing shares of Rainwire Common Stock shall bear the appropriate
"restricted stock legend" evidencing that such shares have not been registered
under the Securities Act.
SECTION 3.04 RIGHTS OF FORMER OASIS OWNERS. At the Effective Time, the
stock transfer books of Oasis shall be closed and no transfer of Oasis Common
Stock by any such holder shall thereafter be made or recognized. Until
surrendered in accordance with the provisions of Section 3.03 of this Agreement,
each certificate theretofore representing shares of Oasis Common Stock (other
than shares to be canceled pursuant to Section 2.04 of this Agreement) shall
from and after the Effective Time represent for all purposes only the right to
receive the consideration provided in Section 2.01 of this Agreement in exchange
therefor.
SECTION 3.05 NO FURTHER OWNERSHIP RIGHTS IN OASIS STOCK. All shares of
Rainwire Common Stock issued upon the surrender for exchange of shares of Oasis
Common Stock in accordance with the terms hereof shall be deemed to have been
issued in full satisfaction of all rights pertaining to such shares of Oasis
Common Stock, and there shall be no further registration of transfers on the
records of Oasis of shares of Oasis Common Stock which were outstanding
immediately prior to the Effective Time.
SECTION 3.06 NO LIABILITY. None of Rainwire, Oasis, the Exchange Agent
or any party hereto shall be liable to any Person in respect of any shares of
Rainwire Common Stock properly delivered to a public official pursuant to any
applicable abandoned property, escheat or similar law.
SECTION 3.07 LOST CERTIFICATES. If any certificate representing Oasis
Common Stock shall have been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the Person claiming such certificate to be lost,
stolen or destroyed and, if required by Rainwire, the posting by such Person of
a bond in such reasonable amount as Rainwire may direct as indemnity against any
claim that may be made against either of them with respect to such certificate,
the transfer agent will issue in exchange for such lost, stolen or destroyed
certificate the Share Exchange Consideration and unpaid dividends and
distributions on shares of Rainwire Common Stock deliverable in respect thereof,
in each case pursuant to this Agreement.
SECTION 3.08 WITHHOLDING RIGHTS. Rainwire shall be entitled to deduct
and withhold from the consideration otherwise payable pursuant to this Agreement
to any holder of shares of Rainwire Common Stock such amounts as it is required
to deduct and withhold with respect to the making of such payment under the Code
and the rules and regulations promulgated thereunder, or any provision of state,
local or foreign tax law. To the extent that amounts are so withheld by Rainwire
such withheld amounts shall be treated for all purposes of this Agreement as
having been paid to the holder of the shares of Oasis Common Stock in respect of
which such deduction and withholding was made by Rainwire.
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SECTION 3.09 FURTHER ASSURANCES. At and after the Effective Time, the
officers and directors of Rainwire shall be authorized to execute and deliver,
in the name and on behalf of Oasis, any deeds, bills of sale, assignments or
assurances and to take and do, in the name and on behalf of Oasis, any other
actions and things to vest, perfect or confirm of record or otherwise in Oasis
any and all right, title and interest in, to and under any of the rights,
properties or assets acquired or to be acquired by Oasis as a result of, or in
connection with, the Share Exchange.
SECTION 3.10 NO FRACTIONAL SHARES. No certificates or scrip
representing fractional shares of Rainwire Common Stock shall be issued upon the
surrender for exchange of certificates, no dividend or distribution of Rainwire
Common Stock shall relate to such fractional share interests and such fractional
share interests will not entitle the owner thereof to vote or to any rights as a
Stockholder of Rainwire. The procedure with respect to fractional shares is set
forth in Section 2.05 hereof.
ARTICLE IV
FURTHER TERMS AND COVENANTS
SECTION 4.01 DELIVERY OF INVESTMENT REPRESENTATION LETTERS. On or
before the Closing, each of the Oasis Shareholders shall execute and deliver to
Rainwire an Investment Representation Letter in the form attached hereto as
Exhibit A.
SECTION 4.02 [RESERVED].
SECTION 4.03 OASIS SHAREHOLDER APPROVAL. Oasis shall (a) take all steps
required by GBCC to obtain the consent of all of its shareholders (by having all
of its shareholders execute this Agreement) as soon as reasonably practicable,
(b) take all action required under the GBCC with respect to the holders of
Dissenting Shares, if any, and (c) in cooperation with Rainwire mail to its
shareholders a transmittal letter to be used by such shareholders in forwarding
their certificates for surrender and exchange.
SECTION 4.04 RAINWIRE SHAREHOLDER APPROVAL. Rainwire shall take all
steps required by the GCDL and the federal securities laws to obtain the consent
of a majority of its shareholders in favor of the Amendment and to notify the
remaining shareholders of the Amendment.
SECTION 4.05 [RESERVED].
SECTION 4.06 NEW DIRECTORS. Upon execution of this Agreement, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ will resign as an officer and director of Rainwire, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ will be appointed to the Board of Directors of
Rainwire, and the number of directors constituting Rainwire's Board of Directors
will be increased to a total of five (5) directors.
SECTION 4.07 CONVERSION OF NOTE. Upon execution of this Agreement,
Rainwire will convert that promissory note by and between Rainwire and Osprey
Investments in the principal amount of $60,000, into 12,000,000 shares of common
stock of Rainwire at $0.005 per share.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF OASIS
Oasis represents and warrants the following to Rainwire:
SECTION 5.01 ORGANIZATION, AUTHORITY AND CAPACITY. Oasis is a corporation,
duly organized, validly existing, and in good standing under the laws of the
State of Georgia, and has the full corporate power and authority necessary to
(a) execute, deliver and perform its obligations under this Agreement and the
other documents and instruments to be executed and delivered by Oasis pursuant
to this Agreement (collectively, the "Share Exchange Documents") and (b) carry
on its business as it has been and is now being conducted and to own and lease
the properties and assets which it now owns or leases. Oasis is duly qualified
to do business and is in good standing in the jurisdictions set forth in
Schedule 5.01, which includes every state of the United States in which the
conduct of the business and the ownership of such properties and assets requires
it to be so qualified.
SECTION 5.02 AUTHORIZATION AND VALIDITY. The execution, delivery and
performance of the Share Exchange Documents to be executed and delivered by
Oasis have been duly authorized by all necessary corporate action on the part of
Oasis. The Share Exchange Documents to be executed and delivered by Oasis have
been or will be, as the case may be, duly executed and delivered by Oasis and
constitute or will constitute the legal, valid and binding obligations of Oasis,
enforceable in accordance with their respective terms, except as may be limited
by bankruptcy, insolvency, or other laws affecting creditors' rights generally,
or as may be modified by a court of equity.
SECTION 5.03 ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS.
Except as set forth on Schedule 5.03, the execution, delivery and performance by
Oasis of the Share Exchange Documents to be executed and delivered by Oasis: (a)
do not require the consent of or notice to any Authority or any other third
party; (b) do not conflict with any provision of Oasis's articles or certificate
of incorporation or bylaws; (c) do not violate any law, ordinance, regulation,
ruling, judgment, order or injunction of any court or governmental
instrumentality to which Oasis is subject or by which Oasis or any of its
respective properties are bound; (d) do not conflict with, constitute grounds
for termination of, result in a breach of, or constitute a default under the
terms of any agreement, instrument, license or permit to which Oasis is a party
or by which Oasis or any of its properties are bound; and (e) will not create
any lien, encumbrance or restriction upon any of the assets or properties of
Oasis.
SECTION 5.04 GOVERNING DOCUMENTS OF OASIS. True and correct copies of
the organizational documents and all amendments thereto of Oasis in effect on
the date hereof have been or will be provided to Rainwire. Rainwire has been or
will be provided with access to the minutes of Oasis, and such minutes
accurately reflect all proceedings of the board of directors of Oasis (and all
committees thereof) required to be reflected in such records through the date
hereof.
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SECTION 5.05 OUTSTANDING AND AUTHORIZED CAPITALIZATION. All authorized
and outstanding shares of Oasis Common Stock are accurately described on
Schedule 5.05. All outstanding shares of Oasis Common Stock are listed and held
of record as indicated on Schedule 5.05 and all shares of outstanding Oasis
Common Stock have been duly and validly issued, and are fully paid and
nonassessable. No shares of Oasis Common Stock were issued in violation of
preemptive rights of any past or present holder of any Oasis Common Stock.
Except as set forth on Schedule 5.05, there are no outstanding warrants,
options, rights, calls or other commitments of any nature relating to Oasis
Common Stock and there are no outstanding securities of Oasis Convertible into
or exchangeable for any Oasis Common Stock. Except as set forth on Schedule
5.05, Oasis is not obligated to issue or repurchase any Oasis Common Stock for
any reason and no person or entity has any right or privilege (whether
preemptive or contractual) for the purchase, subscription or issuance of any
unissued Oasis Common Stock.
SECTION 5.06 FINANCIAL STATEMENTS. Attached hereto as Schedule 5.06(a),
is the audited balance sheet of Oasis for the year ended December 31, 2000,
which reflect the results of operation and financial condition of Oasis for such
periods and at such dates (the "Oasis Financial Statements"). Except as
disclosed in Schedule 5.06(b), to the best of Oasis's or the Oasis Shareholders'
knowledge, as of their respective dates (or if amended or superseded by a
subsequent report created prior to the date of this Agreement, then as of the
date of such subsequent report), the Oasis Financial Statements did not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading. Except as
disclosed in Schedule 5.06(b), to the best of Oasis's or the Oasis Shareholders'
knowledge, the Oasis Financial Statements present fairly the financial position
of Oasis as of the dates indicated and present fairly the results of operations
of Oasis for the periods then ended, and are in accordance with the books and
records of Oasis, which are complete and correct in all material respects.
SECTION 5.07 ABSENCE OF CHANGES. Since December 31, 2000, Oasis has
conducted its business only in the ordinary course and has not, except as set
forth in Schedule 5.07:
(a) suffered any material adverse change in its working
capital, condition (financial or otherwise), assets, liabilities,
reserves, business or operations;
(b) paid, discharged or satisfied any material liability
other than in the ordinary course of business;
(c) written off as uncollectible any account receivable
other than in the ordinary course of business or suffered an impairment
of any other asset (or is aware of any facts that would result in such
write-off or impairment);
(d) compromised any debts, claims or rights or disposed
of any of its properties or assets other than in the ordinary course of
business;
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(e) entered into any commitments or transactions not in
the ordinary course of business involving aggregate value in excess of
$25,000 or made aggregate capital expenditures or commitments in excess
of $25,000;
(f) made any material change in any method of accounting
or accounting practice;
(g) subjected any of its assets, tangible or intangible,
to any Lien, encumbrance or restriction of any nature whatsoever,
except for liens for current property taxes not yet due and payable;
(h) hired, committed to hire or terminated any employee
other than in the ordinary course of business;
(i) except for payments, dividends or distributions
consistent with past practices for prior periods, declared, set aside
or made any payment, dividend or other distribution to any holder of
Oasis Common Stock or purchased, redeemed or otherwise acquired,
directly or indirectly, any Oasis Common Stock;
(j) terminated or amended any material contract, license
or other instrument to which Oasis is a party or suffered any loss or
termination or threatened loss or termination of any existing business
arrangement or material supplier, the termination or loss of which, in
the aggregate, would have a Oasis Material Adverse Effect;
(k) effected any change in its capital structure;
(l) (i) incurred, assumed or refinanced any Indebtedness
other than in the ordinary course of business consistent with past
practice, or (ii) made any loans, advances or capital contributions to,
or investments in, any Person other than an Oasis Subsidiary or any
employee or officer as a cash advance, in each case in the ordinary
course of business and consistent with past practice;
(m) paid, discharged or satisfied any liability,
obligation, or Lien other than payment, discharge or satisfaction of
(i) Indebtedness as it matures and become due and payable or (ii)
liabilities, obligations or Liens in the ordinary course of business
consistent with past practice;
(n) changed any of the accounting or tax principles,
practices or methods used by Oasis, except as required by changes in
applicable Tax Laws or changed reserve amounts or policies;
(o) (i) entered into any employment contract or other
arrangement or made any change in the compensation payable or to become
payable to any of the officers of Oasis or Persons acting in a similar
capacity or Affiliates in the ordinary course consistent with past
practice, (ii) terminated or entered into or amended any employment,
severance, consulting, termination or other agreement or employee
benefit plan, and except for cash advances made in the ordinary course
of business consistent with past practice, (iii) paid
8
any bonuses payable or to become payable to any of the officers of
Oasis or Persons acting in a similar capacity or (iv) made any change
in its existing borrowing or lending arrangements for or on behalf of
any of such Persons pursuant to an employee benefit plan or otherwise;
(p) (i) paid or made any accrual or arrangement for
payment of any pension, retirement allowance or other employee benefit
pursuant to any existing plan, agreement or arrangement to any
Affiliate, officer, employee or Person acting in a similar capacity, or
paid or agreed to pay or made any accrual or arrangement for payment to
any Affiliate, officers, employees or Persons acting in a similar
capacity of any amount relating to unused vacation days, except
payments and accruals made in the ordinary course consistent with past
practice, (ii) granted, issued, accelerated or accrued salary or other
payments or benefits pursuant to any pension, profit-sharing, bonus,
extra compensation, incentive, deferred compensation, stock purchase,
stock option, stock appreciation right, group insurance, severance pay,
retirement or other employee benefit plan, agreement or arrangement, or
any employment or consulting agreement with or for the benefit of any
Affiliate, officer, employee, agent or consultant or Person acting in a
similar capacity, whether past or present or (iii) or amended in any
material respect any such existing plan, agreement or arrangement to
effect any of the foregoing;
(q) made any payments (other than regular compensation
and cash advances payable to officers and employees or Persons acting
in a similar capacity of Oasis in the ordinary course consistent with
past practice), loans, advances or other distributions, or enter into
any transaction, agreement or arrangement with, the Oasis Shareholders,
any Oasis Affiliates, officers, employees, agents, consultants or
Persons acting in a similar capacity, stockholders of their Affiliates,
associates or family members;
(r) settled or compromised any Tax liability or agreed to
any adjustment of any Tax attribute or made any election with respect
to Taxes;
(s) (i) made any change in its working capital practices
generally, including accelerating any collections of cash or accounts
receivable or deferring payments or (ii) failed to make timely
accruals, including with respect to accounts payable and liabilities
incurred in the ordinary course of business;
(t) failed to renew (at levels consistent with presently
existing levels), terminated or amended or failed to perform any of its
obligations or permitted any material default to exist or caused any
material breach under, or entered into (except for renewals in the
ordinary course of business consistent with past practice), any policy
of insurance;
(u) except in the ordinary course of business consistent
with past practice pursuant to appropriate confidentiality agreements,
and except as required by any Law or any existing agreements set forth
on Schedule 5.19 or as may be reasonably necessary to secure or protect
intellectual or other property rights of Oasis, provided any
confidential information to any Person other than Rainwire; or
9
(v) agreed, whether in writing or otherwise, to take any
action described in this Section 5.07.
SECTION 5.08. NO UNDISCLOSED LIABILITIES. To the best of Oasis's or the
Oasis Shareholders' knowledge, Oasis does not have any liabilities, other than
those liabilities which have been adequately reflected in or provided for in the
Oasis Financial Statements or as shown on Schedule 5.08 hereto.
SECTION 5.09. LITIGATION, ETC. Except as listed on Schedule 5.09 hereto
and except for matters that are covered by Oasis's insurance (taking into
account any applicable limits on coverage), (a) there are no claims, lawsuits,
actions, arbitrations, administrative or other proceedings pending (a "Claim")
against Oasis, or to the knowledge of Oasis, no such matter is threatened, and
there is no basis for any such action, (b) to the knowledge of Oasis, there are
no governmental or administrative investigations or inquiries pending that
involve Oasis, (c) there are no judgments against or consent decrees binding on
Oasis or its assets or which may have an adverse effect on, the business or
goodwill of Oasis; and (d) all Claims have been reported to the appropriate
insurance carrier and, to the knowledge of Oasis, Oasis has not received a
notice of denial of coverage or a reservation of rights. A list of all
outstanding Claims against Oasis is set forth on Schedule 5.15.
SECTION 5.10. NO VIOLATION OF LAW. Oasis has not been or is not
currently in violation of any applicable local, state or federal law, ordinance,
regulation, order, injunction or decree, or any other requirement of any
governmental body, agency or authority or court binding on it, or relating to
its property or business or its advertising, sales or pricing practices, except
for any such violations as would not individually or in the aggregate have a
Oasis Material Adverse Effect.
SECTION 5.11. REAL AND PERSONAL PROPERTY.
(a) Schedule 5.11(a) sets forth a list of all items of
material personal and mixed, tangible and intangible property, rights
and assets owned or leased by Oasis. Except as set forth on Schedule
5.11(a), Oasis (i) has good and valid title to all of the personal and
mixed, tangible and intangible property, rights and assets which it
purports to own, including all the personal property and assets
reflected in the Oasis Financial Statements; and (ii) owns such rights,
assets and personal property free and clear of all Liens, encumbrances
or restrictions of any nature whatsoever (except for current year ad
valorem taxes).
(b) Schedule 5.11(b) contains a true and correct
description of all real property owned or leased by Oasis, including
all improvements located thereon. Except as set forth on Schedule
5.11(b), Oasis has good and marketable title to all real property owned
by it, free and clear of any Liens, encumbrances or restrictions of any
nature whatsoever. Rainwire has been furnished with true, correct and
complete copies of all leases, deeds, easements and other documents and
instruments concerning the matters listed on Schedule 5.11(b). No
condemnation or similar actions are currently in effect or pending
against any part of any real property owned or leased by Oasis or, to
the knowledge of Oasis, no such action is threatened against any such
real property. There are no
10
encroachments, leases, easements, covenants, restrictions, reservations
or other burdens of any nature which might impair in any material
respect the use of any owned or leased real property in a manner
consistent with past practices nor does any part of any building
structure or any other improvement thereon encroach on any other
property.
(c) The assets owned or leased by Oasis (including all
buildings and improvements in connection therewith) are in good
operating condition and repair, ordinary wear and tear excepted, and
such assets (together with any assets leased by Oasis) include all
rights, properties, interests in properties, and assets necessary to
permit Oasis to carry on its business as presently conducted following
the Share Exchange.
SECTION 5.12. CONTRACTS AND COMMITMENTS.
(a) Schedule 5.12 contains a complete and accurate list
of all contracts, agreements, commitments, instruments and obligations
(whether written or oral, contingent or otherwise) of Oasis of or
concerning the following matters which involve (i) payments by or to
Oasis in excess of $5,000, (ii) performance by or for Oasis of services
or obligations the value of which is in excess of $5,000, or (iii)
performance by or for Oasis of services or obligations for greater than
90 days (the "Oasis Agreements"):
(i) the lease (as lessee or lessor) or license
(as licensee or licensor) of any real or personal property
(tangible or intangible);
(ii) the employment or engagement of any officer,
director, employee, consultant or agent;
(iii) any relationship with any Oasis Shareholder,
or any person or entity affiliated with or related to any
Oasis Shareholder or any officer, director, employee,
consultant or agent of Oasis;
(iv) any arrangement limiting the freedom of
Oasis to compete in any manner in any line of business;
(v) any arrangement that could reasonably be
anticipated to have a Oasis Material Adverse Effect;
(vi) any arrangement not in the ordinary course
of business;
(vii) any power of attorney, whether limited or
general, granted by or to Oasis;
(viii) any agreements relating to the making of any
loan or advance by Oasis;
(ix) any agreements providing for the
indemnification by Oasis of any Person;
11
(x) any agreements with any Authority except
those entered into in the ordinary course of business which
are not material to Oasis;
(xi) any broker, distributor, dealer or
representative or agency agreements pursuant to which Oasis
made payments in excess of $25,000 during the preceding fiscal
year;
(xii) any agreements (including settlement
agreements) currently in effect pursuant to which Oasis
licenses the right to use any Intellectual Property to any
Person or from any Person (other than license agreements
related to off-the-shelf software products);
(xiii) any confidentiality agreements entered into
by Oasis during the period commencing three years prior to the
date hereof pursuant to which confidential information has
been provided to a third party or by which Oasis was
restricted from providing information to third parties, other
than confidentiality agreements entered into in the normal
course of business;
(xiv) any voting trust or similar agreements
relating to any of the ownership interests in Oasis to which
any of the Oasis Shareholders or Oasis is a party;
(xv) any joint venture, partnership or similar
documents or agreements; and
(xvi) any agreement that materially limits or
purports to materially limit the ability of Oasis to own,
operate, sell, transfer, pledge or otherwise dispose of any
assets.
(b) Oasis has delivered or will deliver to Rainwire true
and complete copies of all Oasis Agreements. Except as indicated on
Schedule 5.12, the Oasis Agreements are valid and enforceable in
accordance with their terms (except to the extent limited by equitable
principles or bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally) and there is not under any of
such contracts (i) any existing or claimed default by Oasis or event
which with the notice or lapse of time, or both, would constitute a
default by Oasis or (ii) to the knowledge of Oasis, any existing or
claimed default by any other party or event which with notice or lapse
of time, or both, would constitute a default by any such party. Except
as indicated on Schedule 5.12, the continuation validity and
enforceability of the Oasis Agreements will not be affected by the
Share Exchange and the Share Exchange will not result in a breach of,
or default under, or require the consent of any other party to any of
the Oasis Agreements. Except as set forth on Schedule 5.12, there is no
actual or, to the knowledge of Oasis, threatened termination,
cancellation or limitation of any Oasis Agreements that would have a
Oasis Material Adverse Effect. To the knowledge of Oasis, there is no
pending or threatened bankruptcy, insolvency or similar proceeding with
respect to any other party to the Oasis Agreements.
12
SECTION 5.13. EMPLOYMENT AND LABOR MATTERS.
(a) Schedule 5.13(a) sets forth (i) the number of
full-time and part-time employees of Oasis and (ii) the name and
compensation paid to each employee of or consultant to Oasis who
currently receives or has received salary, benefits and bonuses for the
two most recently ended fiscal years in excess of $50,000.
(b) Oasis is in compliance in all material respects with
all applicable laws respecting employment and employment practices,
terms and conditions of employment, wages and hours, occupational
safety and health, including the National Labor Relations Act, the
Immigration Reform and Control Act of 1986, Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1991, 42 U.S.C. Section
1981, the Americans With Disabilities Act, the Fair Labor Standards
Act, ERISA, the Occupational Safety and Health Act, the Family Medical
Leave Act, and any other law, ordinance or regulation respecting the
terms and conditions of employment, including authorization to work in
the United States, equal employment opportunity (including prohibitions
against discrimination, harassment, and retaliation), payment of wages,
hours of work, occupational safety and health, and labor practices.
(c) Except as disclosed on Schedule 5.13(c),
(i) there are no charges, governmental audits,
investigations, administrative proceedings or complaints
concerning Oasis's employment practices pending or, to the
knowledge of Oasis, threatened before any federal, state or
local agency or court, and, to the knowledge of Oasis, no
basis for any such matter exists;
(ii) Oasis is not a party to any union or
collective bargaining agreement, and, to the knowledge of
Oasis, no union attempts to organize the employees of Oasis
have been made, nor are any such attempts now threatened; and
(iii) there are no pending or, to the knowledge of
Oasis, threatened material claims by any current or former
employee of Oasis or any employment-related claims or
investigations by any Authority, including any charges to the
Equal Employment Opportunity Commission or state employment
practice agency, investigations regarding compliance with
federal, state or local wage and hour laws, audits by the
Office of Federal Contractor Compliance Programs, complaints
of sexual harassment or any other form of unlawful harassment,
discrimination, or retaliation.
SECTION 5.14. EMPLOYEE BENEFIT MATTERS. Schedule 5.14 attached hereto
sets forth a description of all "Employee Welfare Benefit Plans" and "Employee
Pension Benefit Plans" (as defined in Sections 3(1) and 3(2), respectively, of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"))
existing on the date hereof that are or have been maintained or contributed to
by Oasis. Except as listed on Schedule 5.14, Oasis does not maintain any
retirement or deferred compensation plan, savings, incentive, stock option or
stock purchase plan,
13
unemployment compensation plan, vacation pay, severance pay, bonus or benefit
arrangement, insurance or hospitalization program or any other fringe benefit
arrangement for any employee, consultant or agent of Oasis, whether pursuant to
contract, arrangement, custom or informal understanding, which do not constitute
an "Employee Benefit Plan" (as defined in Section 3(3) of ERISA), for which
Oasis may have any ongoing material liability after Closing. Oasis does not
maintain nor has it ever contributed to any Multi-Employer Plan as defined by
Section 3(37) of ERISA. Oasis does not currently maintain any Employee Pension
Benefit Plan subject to Title IV of ERISA. There have been no "prohibited
transactions" (as described in Section 406 of ERISA or Section 4975 of the Code)
with respect to any Employee Pension Benefit Plan or Employee Welfare Benefit
Plan maintained by Oasis as to which Oasis has been a party. As to any employee
pension benefit plan listed on Schedule 5.14 and subject to Title IV of ERISA,
there have been no reportable events (as such term is defined in Section 4043 of
ERISA).
SECTION 5.15. INSURANCE POLICIES. Attached hereto as Schedule 5.15 is a
list of all insurance policies of Oasis setting forth with respect to each
policy the name of the insurer, a description of the policy, the dollar amount
of coverage, the amount of the premium, the date through which all premiums have
been paid, and the expiration date. Each insurance policy relating to the
insurance referred to in Schedule 5.15 is in full force and effect, is valid and
enforceable, and Oasis is not in breach of or in default under any such policy.
All policies listed on Schedule 5.15 will be outstanding and duly in force at
the Closing Date, the premiums payable in respect of such policies have been
paid or will be paid in full prior to the closing date, and none of such
policies provide for any retrospective premium adjustment or other experience
based liability on the part of Oasis. Oasis has not received any notice of or
any reason to believe that there is or has been any actual, threatened, or
contemplated termination or cancellation of any insurance policy relating to the
said insurance. Oasis has not since inception (a) been denied or had revoked,
canceled or rescinded any policy of insurance, or (b) self insured against any
risk ordinarily insured against by similar businesses. Schedule 5.15 contains a
true, correct and complete list and summary of all claims which have been made
under each insurance policy relating to the said insurance. Oasis has not failed
to give any notice or to present any claim under any insurance policy in a due
and timely fashion, and to the best of its knowledge, all insurable risks are
adequately covered by insurance except for any exposure occasioned by lack of
Directors' and Officers' insurance coverage.
SECTION 5.16. TAXES. Except as set forth on Schedule 5.16, Oasis has
filed or obtained filing extensions for all tax returns, federal, state, county,
and local, including payroll taxes, required to be filed by it, and Oasis has
paid or established adequate reserves (in accordance with generally accepted
accounting principles) for the payment of all taxes shown to be due by such
returns as well as all other taxes, assessments, and governmental charges which
have become due or payable, including, without limitation, all taxes which Oasis
is obligated to withhold from amounts owing to employees, creditors, and third
parties. The federal income tax returns of Oasis have never been audited by the
Internal Revenue Service and no state income or sales tax returns of Oasis have
been audited. No deficiency assessment with respect to or proposed adjustment of
Oasis's federal, state, county, or local taxes, including payroll taxes, is
pending or, to the best of Oasis's knowledge, threatened. There is no tax lien,
whether imposed by any federal, state, county, or local taxing authority,
outstanding against the assets, properties, or business of Oasis (other than
liens for taxes not yet due and payable). Neither Oasis nor any of its
shareholders
14
have ever filed a consent pertaining to Oasis pursuant to Section 341(f) of the
IRC (as hereinafter defined), relating to collapsible corporations.
SECTION 5.17. INTERESTED TRANSACTIONS. Except as provided on Schedule
5.17, Oasis is not a party to any contract, loan or other transaction with any
Oasis Shareholder nor does Oasis have any direct or indirect interest in or
affiliation with any Oasis Shareholder to any such contract, loan or other
transaction. No Oasis Shareholder is an employee, consultant, partner,
principal, director or owner of, or has any other direct or indirect interest in
or affiliation with, any person or business entity that is engaged in a business
that competes with or is similar to the business of Oasis.
SECTION 5.18. INTELLECTUAL PROPERTY.
(a) Attached hereto as Schedule 5.18 is a true, correct
and complete list of all of Oasis's patents, trademarks, trade names,
or trademark or trade name registrations, domain name registrations,
service marks, and copyrights or copyright registrations (the
"Proprietary Rights"). All of Oasis's Proprietary Rights are valid,
enforceable, in full force and effect and free and clear of any and all
security interests, liens, pledges and encumbrances of any nature or
kind. Oasis has not infringed upon and are not infringing upon any
patent, trademark, trade name, or trademark or trade name registration,
service ▇▇▇▇, copyright, or copyright registration of any other Person.
(b) No trade secret or confidential know-how material to
the business of Oasis as currently operated has been disclosed or
authorized to be disclosed to any third party, other than pursuant to a
non-disclosure agreement that protects Oasis's proprietary interests in
and to such trade secrets and confidential know-how, and other than
disclosures to employees, officers, directors, agents, attorneys,
accountants, consultants, independent contractors or other
representatives of Oasis, each of whom is obligated (by contract,
employment policy, cannons of ethics or the like) to maintain the
confidentiality of such information.
(c) The consummation of the transactions contemplated
hereby will not result in the loss or impairment of the right of
Rainwire or any of its successors to own, use, license or sublicense
any of the Intellectual Property currently owned, used, licensed or
sublicensed by Oasis nor will it require the consent of any Authority
or third party in respect of any such Intellectual Property and no
present or former employee, or officer of Oasis has any right, title or
interest, directly or indirectly, in whole or in part, in any
Intellectual Property.
SECTION 5.19. REQUIRED VOTE OF OASIS SHAREHOLDERS. The Persons listed
on Schedule 1 include all of the Shareholders of Oasis, and all such Persons
have approved of, and executed a copy of, this Agreement. No other vote of the
Oasis Shareholders is required by the certificate of incorporation or bylaws of
Oasis or any other governing documents of Oasis in order for Oasis to consummate
the Share Exchange and the transactions contemplated hereby.
15
SECTION 5.20. BROKERAGE. Except as disclosed on Schedule 5.20, neither
Oasis, nor any Exchanging Shareholder has employed any broker, finder, advisor,
consultant or other intermediary in connection with this Agreement or the
transactions contemplated by this Agreement who is or might be entitled to any
fee, commission or other compensation from Oasis, or from Rainwire or its
Affiliates, upon or as a result of the execution of this Agreement or the
consummation of the transactions contemplated hereby. Such fee shall be borne by
the Oasis Shareholders and not by Oasis or Rainwire.
SECTION 5.21. STATEMENTS TRUE AND CORRECT. No representation or
warranty made herein by Oasis or any of the Oasis Shareholders, nor in any
statement, certificate or instrument to be furnished to Rainwire by Oasis or any
of the Oasis Shareholders pursuant to any Share Exchange Document, contains or
will contain any untrue statement of material fact or omits or will omit to
state a material fact necessary, in light of the circumstances under which it
was made, to make these statements contained herein and therein not misleading.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF RAINWIRE
Rainwire hereby represents and warrants to Oasis as follows:
SECTION 6.01. ORGANIZATION, AUTHORITY AND CAPACITY. Rainwire is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. Rainwire has the full power and authority necessary to
(a) execute, deliver and perform its obligations under the Share Exchange
Documents to be executed and delivered by it, and (b) carry on its business as
it has been and is now being conducted and to own and lease the properties and
assets which it now owns or leases. Rainwire is duly qualified to do business
and is in good standing in the jurisdictions set forth on Schedule 6.01, which
includes every state of the United States in which the conduct of the business
and the ownership of such properties and assets requires it to be so qualified.
SECTION 6.02. AUTHORIZATION AND VALIDITY. The execution, delivery and
performance of the Share Exchange Documents to be executed and delivered by
Rainwire have been duly authorized by all necessary corporate action by
Rainwire. The Share Exchange Documents to be executed and delivered by Rainwire
have been or will be, as the case may be, duly executed and delivered by
Rainwire and constitute or will constitute the legal, valid and binding
obligations of Rainwire, enforceable in accordance with their respective terms,
except as may be limited by bankruptcy, insolvency, or other laws affecting
creditors' rights generally, or as may be modified by a court of equity.
SECTION 6.03. ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS.
Except as set forth on Schedule 6.03, the execution, delivery and performance by
Rainwire of the Share Exchange Documents to be executed and delivered by it: (a)
do not require the consent of or notice to any Authority or any other third
party; (b) will not conflict with any provision of Rainwire's articles or
certificate of incorporation or bylaws; (c) do not conflict with or result in a
violation of any law, ordinance, regulation, ruling, judgment, order or
injunction of any court or
16
governmental instrumentality to which Rainwire is a party or by which Rainwire
or any of its respective properties are bound; (d) do not conflict with,
constitute grounds for termination of, result in a breach of, constitute a
default under, require any notice under, or accelerate or permit the
acceleration of any performance required by the terms of any Rainwire Material
Agreement; and (e) will not create any lien, encumbrance or restriction upon any
of the assets or properties of Rainwire.
SECTION 6.04. GOVERNING DOCUMENTS. True and correct copies of the
organizational documents and all amendments thereto of Rainwire and copies of
the bylaws of Rainwire have been provided to Oasis. Oasis has previously been
provided with access to Rainwire's minutes, and such minutes accurately reflect
all proceedings of the shareholders and board of directors of Rainwire (and all
committees thereof).
SECTION 6.05. OUTSTANDING AND AUTHORIZED CAPITALIZATION. The authorized
capital stock of Rainwire consists of 20,000,000 shares of Rainwire Common Stock
and 2,500,000 shares of Rainwire Preferred Stock. As of the date of this
Agreement, Rainwire has 7,705,387 shares of Rainwire Common Stock and 24,960
shares of Preferred Stock issued and outstanding. All issued and outstanding
shares of Rainwire Common Stock have been duly and validly issued, and are fully
paid and non-assessable. Except as set forth in Schedule 6.05, there are no
outstanding warrants, options, rights, calls or other commitments of any nature
relating to shares of capital stock of Rainwire, no outstanding securities
convertible into or exchangeable for shares of capital stock of Rainwire, and,
Rainwire is not obligated to issue or repurchase any of its shares of capital
stock for any reason and no person or entity has any right or privilege (whether
preemptive or contractual) for the purchase, subscription or issuance of any
unissued shares of capital stock of Rainwire. Except as set forth in Schedule
6.05 or the Certificate of Incorporation, as amended, Rainwire has no obligation
or right (contingent or other) to purchase, redeem, or otherwise acquire any of
its equity securities or any interests therein or to pay any dividend or make
any other distribution in respect thereof. Except as set forth in Schedule 6.05,
there are no voting trusts or agreements nor any preemptive rights relating to
any outstanding securities of Rainwire (whether or not Rainwire is a party
thereto). No shares of Rainwire Common Stock are held in Rainwire's treasury.
All outstanding securities of Rainwire were issued in compliance with all
applicable federal and state securities laws. All Rainwire Common Stock to be
issued in connection with the Share Exchange will be duly and validly issued,
fully paid and nonassessable.
SECTION 6.06. REPORTS AND FINANCIAL STATEMENTS. Prior to the closing,
Rainwire shall complete, file and make available to Oasis (including through the
SEC's ▇▇▇▇▇ system) true and complete copies of: (a) Rainwire's Annual Report on
Form 10-KSB filed with the SEC for the fiscal year ending December 31, 2000; (b)
Rainwire's Quarterly Report on Form 10-QSB filed with the SEC for the quarter
ended March 31, 2001, (c) Rainwire's Quarterly Report on Form 10-QSB filed with
the SEC for the quarter ended June 30, 2001 (individually a "SEC Report" and
collectively, the "SEC Reports"). To the best of Rainwire's knowledge, the
audited consolidated financial statements and unaudited consolidated interim
financial statements included in Rainwire SEC Reports (including any related
notes and schedules) complied as to form, as of their respective dates of filing
with the SEC, in all material respects with all applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto, were
17
prepared in accordance with GAAP consistently applied during the periods
involved (except as otherwise disclosed in the notes thereto, and except that
unaudited statements do not contain footnotes in substance or form required by
GAAP, as is permitted by Form 10-QSB of the Exchange Act) and fairly presented
the financial position of Rainwire and its consolidated Subsidiaries as of the
dates thereof and the results of operations and cash flows for the periods or as
of the dates then ended (subject, where appropriate, to normal year-end
adjustments).
SECTION 6.07. ABSENCE OF CHANGES. Since June 30, 2001, Rainwire has
conducted its business only in the ordinary course and has not, except as set
forth in the SEC Reports or Schedule 6.07:
(a) suffered any material adverse change in its working
capital, condition (financial or otherwise), assets, liabilities,
reserves, business or operations;
(b) paid, discharged or satisfied any material liability
other than in the ordinary course of business;
(c) written off as uncollectible any account receivable
other than in the ordinary course of business or suffered an impairment
of any other asset (or is aware of any facts that would result in such
write-off or impairment);
(d) compromised any debts, claims or rights or disposed
of any of its properties or assets other than in the ordinary course of
business;
(e) entered into any commitments or transactions not in
the ordinary course of business involving aggregate value in excess of
$25,000 or made aggregate capital expenditures or commitments in excess
of $25,000;
(f) made any material change in any method of accounting
or accounting practice;
(g) subjected any of its assets, tangible or intangible,
to any Lien, encumbrance or restriction of any nature whatsoever,
except for liens for current property taxes not yet due and payable;
(h) hired, committed to hire or terminated any employee
other than in the ordinary course of business;
(i) except for payments, dividends or distributions
consistent with past practices for prior periods, declared, set aside
or made any payment, dividend or other distribution to any holder of
Rainwire Common Stock or purchased, redeemed or otherwise acquired,
directly or indirectly, any Rainwire Common Stock;
(j) terminated or amended any material contract, license
or other instrument to which Rainwire is a party or suffered any loss
or termination or threatened loss or termination of any existing
business arrangement or material supplier, the termination or loss of
which, in the aggregate, would have a Rainwire Material Adverse Effect;
18
(k) effected any change in its capital structure;
(l) (i) incurred, assumed or refinanced any Indebtedness
other than in the ordinary course of business consistent with past
practice, or (ii) made any loans, advances or capital contributions to,
or investments in, any Person other than an Rainwire Subsidiary or any
employee or officer as a cash advance, in each case in the ordinary
course of business and consistent with past practice;
(m) paid, discharged or satisfied any liability,
obligation, or Lien other than payment, discharge or satisfaction of
(i) Indebtedness as it matures and become due and payable or (ii)
liabilities, obligations or Liens in the ordinary course of business
consistent with past practice;
(n) changed any of the accounting or tax principles,
practices or methods used by Rainwire, except as required by changes in
applicable Tax Laws or changed reserve amounts or policies;
(o) (i) entered into any employment contract or other
arrangement or made any change in the compensation payable or to become
payable to any of the officers of Rainwire or Persons acting in a
similar capacity or Affiliates in the ordinary course consistent with
past practice, (ii) terminated or entered into or amended any
employment, severance, consulting, termination or other agreement or
employee benefit plan, and except for cash advances made in the
ordinary course of business consistent with past practice, (iii) paid
any bonuses payable or to become payable to any of the officers of
Rainwire or Persons acting in a similar capacity or (iv) made any
change in its existing borrowing or lending arrangements for or on
behalf of any of such Persons pursuant to an employee benefit plan or
otherwise;
(p) (i) paid or made any accrual or arrangement for
payment of any pension, retirement allowance or other employee benefit
pursuant to any existing plan, agreement or arrangement to any
Affiliate, officer, employee or Person acting in a similar capacity, or
paid or agreed to pay or made any accrual or arrangement for payment to
any Affiliate, officers, employees or Persons acting in a similar
capacity of any amount relating to unused vacation days, except
payments and accruals made in the ordinary course consistent with past
practice, (ii) granted, issued, accelerated or accrued salary or other
payments or benefits pursuant to any pension, profit-sharing, bonus,
extra compensation, incentive, deferred compensation, stock purchase,
stock option, stock appreciation right, group insurance, severance pay,
retirement or other employee benefit plan, agreement or arrangement, or
any employment or consulting agreement with or for the benefit of any
Affiliate, officer, employee, agent or consultant or Person acting in a
similar capacity, whether past or present or (iii) or amended in any
material respect any such existing plan, agreement or arrangement to
effect any of the foregoing;
(q) made any payments (other than regular compensation
and cash advances payable to officers and employees or Persons acting
in a similar capacity of Rainwire in the ordinary course consistent
with past practice), loans, advances or other distributions, or
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enter into any transaction, agreement or arrangement with, the Rainwire
Shareholders, any Rainwire Affiliates, officers, employees, agents,
consultants or Persons acting in a similar capacity, stockholders of
their Affiliates, associates or family members;
(r) settled or compromised any Tax liability or agreed to
any adjustment of any Tax attribute or made any election with respect
to Taxes;
(s) (i) made any change in its working capital practices
generally, including accelerating any collections of cash or accounts
receivable or deferring payments or (ii) failed to make timely
accruals, including with respect to accounts payable and liabilities
incurred in the ordinary course of business;
(t) failed to renew (at levels consistent with presently
existing levels), terminated or amended or failed to perform any of its
obligations or permitted any material default to exist or caused any
material breach under, or entered into (except for renewals in the
ordinary course of business consistent with past practice), any policy
of insurance;
(u) except in the ordinary course of business consistent
with past practice pursuant to appropriate confidentiality agreements,
and except as required by any Law or as may be reasonably necessary to
secure or protect intellectual or other property rights of Rainwire,
provided any confidential information to any Person other than
Rainwire; or
(v) agreed, whether in writing or otherwise, to take any
action described in this Section 6.07.
SECTION 6.08. NO UNDISCLOSED LIABILITIES. To the best of Rainwire's
knowledge, neither Rainwire nor any of its Subsidiaries have any Liabilities or
obligations of any nature, whether or not accrued, contingent or otherwise,
except (a) Liabilities or obligations reflected in any of the SEC Reports, (b)
Liabilities incurred in the ordinary course of business since the date of the
most recent SEC Reports, or (c) Liabilities or obligations that would not,
individually or in the aggregate, have an Rainwire Material Adverse Effect.
SECTION 6.09. LITIGATION, ETC. Except as listed on Schedule 6.09 hereto
and except for matters that are covered by Rainwire's insurance (taking into
account any applicable limits on coverage), (a) there are no claims, lawsuits,
actions, arbitrations, administrative or other proceedings pending (a "Claim")
against Rainwire, or to the knowledge of Rainwire, no such matter is threatened,
and there is no basis for any such action, (b) to the knowledge of Rainwire,
there are no governmental or administrative investigations or inquiries pending
that involve Rainwire, (c) there are no judgments against or consent decrees
binding on Rainwire or its assets or which may have an adverse effect on, the
business or goodwill of Rainwire; and (d) all Claims have been reported to the
appropriate insurance carrier and, to the knowledge of Rainwire, Rainwire has
not received a notice of denial of coverage or a reservation of rights. A list
of all outstanding Claims against Rainwire is set forth on Schedule 6.15.
SECTION 6.10. NO VIOLATION OF LAW. The business of Rainwire and its
Subsidiaries have not been and are not currently in violation of no local, state
or federal law, ordinance, regulation,
20
order, injunction or decree, or any other requirement of any governmental body
except (a) as described in any of the SEC Reports and (b) for violations that
would not, individually or in the aggregate, have an Rainwire Material Adverse
Effect.
SECTION 6.11. REAL AND PERSONAL PROPERTY.
(a) Schedule 6.11(a) sets forth a list of all items of
material personal and mixed, tangible and intangible property, rights
and assets owned or leased by Rainwire. Except as set forth on Schedule
6.11(a), Rainwire (i) has good and valid title to all of the personal
and mixed, tangible and intangible property, rights and assets which it
purports to own, including all the personal property and assets
reflected in the Rainwire Financial Statements; and (ii) owns such
rights, assets and personal property free and clear of all Liens,
encumbrances or restrictions of any nature whatsoever (except for
current year ad valorem taxes).
(b) Schedule 6.11(b) contains a true and correct
description of all real property owned or leased by Rainwire, including
all improvements located thereon. Except as set forth on Schedule
6.11(b), Rainwire has good and marketable title to all real property
owned by it, free and clear of any Liens, encumbrances or restrictions
of any nature whatsoever. Oasis has been furnished with true, correct
and complete copies of all leases, deeds, easements and other documents
and instruments concerning the matters listed on Schedule 6.11(b). No
condemnation or similar actions are currently in effect or pending
against any part of any real property owned or leased by Rainwire or,
to the knowledge of Rainwire, no such action is threatened against any
such real property. There are no encroachments, leases, easements,
covenants, restrictions, reservations or other burdens of any nature
which might impair in any material respect the use of any owned or
leased real property in a manner consistent with past practices nor
does any part of any building structure or any other improvement
thereon encroach on any other property.
(c) The assets owned or leased by Rainwire (including all
buildings and improvements in connection therewith) are in good
operating condition and repair, ordinary wear and tear excepted, and
such assets (together with any assets leased by Rainwire) include all
rights, properties, interests in properties, and assets necessary to
permit Rainwire to carry on its business as presently conducted
following the Share Exchange.
SECTION 6.12. CONTRACTS AND COMMITMENTS.
(a) Schedule 6.12 contains a complete and accurate list
of all contracts, agreements, commitments, instruments and obligations
(whether written or oral, contingent or otherwise) of Rainwire of or
concerning the following matters which involve (i) payments by or to
Rainwire in excess of $5,000, (ii) performance by or for Rainwire of
services or obligations the value of which is in excess of $5,000, or
(iii) performance by or for Rainwire of services or obligations for
greater than 90 days (the "Rainwire Agreements"):
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(i) the lease (as lessee or lessor) or license
(as licensee or licensor) of any real or personal property
(tangible or intangible);
(ii) the employment or engagement of any officer,
director, employee, consultant or agent;
(iii) any relationship with any Rainwire
Shareholder, or any person or entity affiliated with or
related to any Rainwire Shareholder or any officer, director,
employee, consultant or agent of Rainwire;
(iv) any arrangement limiting the freedom of
Rainwire to compete in any manner in any line of business;
(v) any arrangement that could reasonably be
anticipated to have a Rainwire Material Adverse Effect;
(vi) any arrangement not in the ordinary course
of business;
(vii) any power of attorney, whether limited or
general, granted by or to Rainwire;
(viii) any agreements relating to the making of any
loan or advance by Rainwire;
(ix) any agreements providing for the
indemnification by Rainwire of any Person;
(x) any agreements with any Authority except
those entered into in the ordinary course of business which
are not material to Rainwire;
(xi) any broker, distributor, dealer or
representative or agency agreements pursuant to which Rainwire
made payments in excess of $25,000 during the preceding fiscal
year;
(xii) any agreements (including settlement
agreements) currently in effect pursuant to which Rainwire
licenses the right to use any Intellectual Property to any
Person or from any Person (other than license agreements
related to off-the-shelf software products);
(xiii) any confidentiality agreements entered into
by Rainwire during the period commencing three years prior to
the date hereof pursuant to which confidential information has
been provided to a third party or by which Rainwire was
restricted from providing information to third parties, other
than confidentiality agreements entered into in the normal
course of business;
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(xiv) any voting trust or similar agreements
relating to any of the ownership interests in Rainwire to
which any of the Rainwire Shareholders or Rainwire is a party;
(xv) any joint venture, partnership or similar
documents or agreements; and
(xvi) any agreement that materially limits or
purports to materially limit the ability of Rainwire to own,
operate, sell, transfer, pledge or otherwise dispose of any
assets.
(b) Rainwire has delivered or will deliver to Oasis true
and complete copies of all Rainwire Agreements. Except as indicated on
Schedule 6.12, the Rainwire Agreements are valid and enforceable in
accordance with their terms (except to the extent limited by equitable
principles or bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally) and there is not under any of
such contracts (i) any existing or claimed default by Rainwire or event
which with the notice or lapse of time, or both, would constitute a
default by Rainwire or (ii) to the knowledge of Rainwire, any existing
or claimed default by any other party or event which with notice or
lapse of time, or both, would constitute a default by any such party.
Except as indicated on Schedule 6.12, the continuation validity and
enforceability of the Rainwire Agreements will not be affected by the
Share Exchange and the Share Exchange will not result in a breach of,
or default under, or require the consent of any other party to any of
the Rainwire Agreements. Except as set forth on Schedule 6.12, there is
no actual or, to the knowledge of Rainwire, threatened termination,
cancellation or limitation of any Rainwire Agreements that would have a
Rainwire Material Adverse Effect. To the knowledge of Rainwire, there
is no pending or threatened bankruptcy, insolvency or similar
proceeding with respect to any other party to the Rainwire Agreements.
SECTION 6.13. EMPLOYMENT AND LABOR MATTERS.
(a) Schedule 6.13(a) sets forth (i) the number of
full-time and part-time employees of Rainwire and (ii) the name and
compensation paid to each employee of or consultant to Rainwire who
currently receives or has received salary, benefits and bonuses for the
two most recently ended fiscal years in excess of $50,000.
(b) Rainwire is in compliance in all material respects
with all applicable laws respecting employment and employment
practices, terms and conditions of employment, wages and hours,
occupational safety and health, including the National Labor Relations
Act, the Immigration Reform and Control Act of 1986, Title VII of the
Civil Rights Act of 1964, the Civil Rights Act of 1991, 42 U.S.C.
Section 1981, the Americans With Disabilities Act, the Fair Labor
Standards Act, ERISA, the Occupational Safety and Health Act, the
Family Medical Leave Act, and any other law, ordinance or regulation
respecting the terms and conditions of employment, including
authorization to work in the United States, equal employment
opportunity (including prohibitions against
23
discrimination, harassment, and retaliation), payment of wages, hours
of work, occupational safety and health, and labor practices.
(c) Except as disclosed on Schedule 6.13(c),
(i) there are no charges, governmental audits,
investigations, administrative proceedings or complaints
concerning Rainwire's employment practices pending or, to the
knowledge of Rainwire, threatened before any federal, state or
local agency or court, and, to the knowledge of Rainwire, no
basis for any such matter exists;
(ii) Rainwire is not a party to any union or
collective bargaining agreement, and, to the knowledge of
Rainwire, no union attempts to organize the employees of
Rainwire have been made, nor are any such attempts now
threatened; and
(iii) there are no pending or, to the knowledge of
Rainwire, threatened material claims by any current or former
employee of Rainwire or any employment-related claims or
investigations by any Authority, including any charges to the
Equal Employment Opportunity Commission or state employment
practice agency, investigations regarding compliance with
federal, state or local wage and hour laws, audits by the
Office of Federal Contractor Compliance Programs, complaints
of sexual harassment or any other form of unlawful harassment,
discrimination, or retaliation.
SECTION 6.14. EMPLOYEE BENEFIT MATTERS. Schedule 6.14 attached hereto
sets forth a description of all "Employee Welfare Benefit Plans" and "Employee
Pension Benefit Plans" (as defined in Sections 3(1) and 3(2), respectively, of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"))
existing on the date hereof that are or have been maintained or contributed to
by Rainwire. Except as listed on Schedule 6.14, Rainwire does not maintain any
retirement or deferred compensation plan, savings, incentive, stock option or
stock purchase plan, unemployment compensation plan, vacation pay, severance
pay, bonus or benefit arrangement, insurance or hospitalization program or any
other fringe benefit arrangement for any employee, consultant or agent of
Rainwire, whether pursuant to contract, arrangement, custom or informal
understanding, which do not constitute an "Employee Benefit Plan" (as defined in
Section 3(3) of ERISA), for which Rainwire may have any ongoing material
liability after Closing. Oasis does not maintain nor has it ever contributed to
any Multi-Employer Plan as defined by Section 3(37) of ERISA. Rainwire does not
currently maintain any Employee Pension Benefit Plan subject to Title IV of
ERISA. There have been no "prohibited transactions" (as described in Section 406
of ERISA or Section 4975 of the Code) with respect to any Employee Pension
Benefit Plan or Employee Welfare Benefit Plan maintained by Rainwire as to which
Rainwire has been a party. As to any employee pension benefit plan listed on
Schedule 6.14 and subject to Title IV of ERISA, there have been no reportable
events (as such term is defined in Section 4043 of ERISA).
SECTION 6.15. INSURANCE POLICIES. Attached hereto as Schedule 6.15 is a
list of all insurance policies of Rainwire setting forth with respect to each
policy the name of the insurer, a
24
description of the policy, the dollar amount of coverage, the amount of the
premium, the date through which all premiums have been paid, and the expiration
date. Each insurance policy relating to the insurance referred to in Schedule
6.15 is in full force and effect, is valid and enforceable, and Rainwire is not
in breach of or in default under any such policy. All policies listed on
Schedule 6.15 will be outstanding and duly in force at the Closing Date, the
premiums payable in respect of such policies have been paid or will be paid in
full prior to the closing date, and none of such policies provide for any
retrospective premium adjustment or other experience based liability on the part
of Rainwire. Rainwire has not received any notice of or any reason to believe
that there is or has been any actual, threatened, or contemplated termination or
cancellation of any insurance policy relating to the said insurance. Rainwire
has not since inception (a) been denied or had revoked, canceled or rescinded
any policy of insurance, or (b) self insured against any risk ordinarily insured
against by similar businesses. Schedule 6.15 contains a true, correct and
complete list and summary of all claims which have been made under each
insurance policy relating to the said insurance. Rainwire has not failed to give
any notice or to present any claim under any insurance policy in a due and
timely fashion, and to the best of its knowledge, all insurable risks are
adequately covered by insurance except for any exposure occasioned by lack of
Directors' and Officers' insurance coverage.
SECTION 6.16. TAXES. Except as set forth on Schedule 6.16, Rainwire has
filed or obtained filing extensions for all tax returns, federal, state, county,
and local, including payroll taxes, required to be filed by it, and Rainwire has
paid or established adequate reserves (in accordance with generally accepted
accounting principles) for the payment of all taxes shown to be due by such
returns as well as all other taxes, assessments, and governmental charges which
have become due or payable, including, without limitation, all taxes which
Rainwire is obligated to withhold from amounts owing to employees, creditors,
and third parties. The federal income tax returns of Rainwire have never been
audited by the Internal Revenue Service and no state income or sales tax returns
of Rainwire have been audited. No deficiency assessment with respect to or
proposed adjustment of Rainwire's federal, state, county, or local taxes,
including payroll taxes, is pending or, to the best of Rainwire's knowledge,
threatened. There is no tax lien, whether imposed by any federal, state, county,
or local taxing authority, outstanding against the assets, properties, or
business of Rainwire (other than liens for taxes not yet due and payable).
Neither Rainwire nor any of its shareholders have ever filed a consent
pertaining to Rainwire pursuant to Section 341(f) of the IRC (as hereinafter
defined), relating to collapsible corporations.
SECTION 6.17. INTERESTED TRANSACTIONS. Except as provided on Schedule
6.17, Rainwire is not a party to any contract, loan or other transaction with
any Rainwire Shareholder nor does Rainwire have any direct or indirect interest
in or affiliation with any Rainwire Shareholder to any such contract, loan or
other transaction. No Rainwire Shareholder is an employee, consultant, partner,
principal, director or owner of, or has any other direct or indirect interest in
or affiliation with, any person or business entity that is engaged in a business
that competes with or is similar to the business of Rainwire.
SECTION 6.18. INTELLECTUAL PROPERTY.
(a) Attached hereto as Schedule 6.18 is a true, correct
and complete list of all of Rainwire's patents, trademarks, trade
names, or trademark or trade name registrations,
25
domain name registrations, service marks, and copyrights or copyright
registrations (the "Proprietary Rights"). All of Rainwire's Proprietary
Rights are valid, enforceable, in full force and effect and free and
clear of any and all security interests, liens, pledges and
encumbrances of any nature or kind. Rainwire has not infringed upon and
are not infringing upon any patent, trademark, trade name, or trademark
or trade name registration, service ▇▇▇▇, copyright, or copyright
registration of any other Person.
(b) No trade secret or confidential know-how material to
the business of Rainwire as currently operated has been disclosed or
authorized to be disclosed to any third party, other than pursuant to a
non-disclosure agreement that protects Rainwire's proprietary interests
in and to such trade secrets and confidential know-how, and other than
disclosures to employees, officers, directors, agents, attorneys,
accountants, consultants, independent contractors or other
representatives of Rainwire, each of whom is obligated (by contract,
employment policy, cannons of ethics or the like) to maintain the
confidentiality of such information.
(c) The consummation of the transactions contemplated
hereby will not result in the loss or impairment of the right of
Rainwire or any of its successors to own, use, license or sublicense
any of the Intellectual Property currently owned, used, licensed or
sublicensed by Rainwire nor will it require the consent of any
Authority or third party in respect of any such Intellectual Property
and no present or former employee, or officer of Rainwire has any
right, title or interest, directly or indirectly, in whole or in part,
in any Intellectual Property.
SECTION 6.19. BROKERAGE. Except as disclosed on Schedule 6.20, Rainwire
has not employed any broker, finder, advisor, consultant or other intermediary
in connection with this Agreement or the transactions contemplated by this
Agreement who is or might be entitled to any fee, commission or other
compensation from Rainwire, or from Oasis or its Affiliates, upon or as a result
of the execution of this Agreement or the consummation of the transactions
contemplated hereby. Such fee shall be borne by Rainwire.
SECTION 6.20. SUBSIDIARIES. Except as set forth on Schedule 6.20,
Rainwire does not have any subsidiaries and does not, directly or indirectly,
own a controlling interest in any corporation, partnership, joint venture or
other entity.
SECTION 6.21. STATEMENTS TRUE AND CORRECT. No representation or
warranty made herein by Rainwire, nor in any statement, certificate or
instrument to be furnished to Oasis or the Oasis Shareholders by Rainwire
pursuant to any Share Exchange Document, contains or will contain any untrue
statement of material fact or omits or will omit to state a material fact
necessary, in light of the circumstances under which it was made, to make these
statements contained herein and therein not misleading.
26
ARTICLE VII
ADDITIONAL AGREEMENTS
SECTION 7.01. ACCESS TO INFORMATION. From the date of this Agreement
through the Closing Date, Oasis will afford the officers and authorized
representatives of Rainwire access during regular business hours and upon
reasonable notice to Oasis's properties, books and records that may relate to or
concern the Share Exchange and will furnish such parties with such additional
financial, operating and other information as to the business and properties of
Oasis as such parties may from time to time reasonably request. Such parties
shall also be allowed access, upon reasonable notice, to consult with the
officers, employees, accountants, counsel and agents of Oasis in connection with
such investigation of the properties and business of Oasis. In addition, from
the date of this Agreement through the Closing Date, Rainwire will afford the
officers and authorized representatives of Oasis access during regular business
hours and upon reasonable notice to all of Rainwire's properties, books and
records that may relate to or concern the Share Exchange and will furnish such
parties with such additional financial, operating and other information as to
the business and properties of Rainwire as such parties may from time to time
reasonably request. Such parties shall also be allowed access, upon reasonable
notice, to consult with the officers, employees, accountants, counsel and agents
of Rainwire in connection with such investigation of the properties and business
of Rainwire. In each case, such access or investigation shall be subject to
Section 7.07.
SECTION 7.02. NO-SHOP. Unless and until this Agreement is terminated
pursuant to Article X hereof, Oasis shall not directly or indirectly, through
any officer, director, shareholder, employee, agent, or otherwise: (a) solicit,
initiate or encourage submission of proposals or offers from any person or other
entity relating to any purchase of any acquisition or business combination of
all or a material amount of the assets of, or an equity interest in Oasis, or
approve or undertake any such transaction; (b) participate in any discussions or
negotiations regarding, or furnish to any other person, corporation or other
entity, any information with respect to, or otherwise cooperate in any way with,
or assist or participate in, facilitate or encourage, any effort or attempt by
any other person, corporation or other entity to do, any of the foregoing; or
(c) enter into any contract, agreement or understanding, whether oral or
written, that would prevent the consummation of the Share Exchange.
Notwithstanding the foregoing, in the event Oasis or any Oasis Shareholder shall
directly or indirectly receive a proposal relating to any acquisition or
business combination involving Oasis, Oasis or such Oasis Shareholder shall
immediately notify Rainwire in writing of the terms of such proposal. Oasis
agrees that it will, and will cause its officers, directors and representatives
to, immediately cease and cause to be terminated any activities, discussions or
negotiations existing as of the date of this Agreement with any parties
conducted heretofore with respect to any acquisition, business combination,
equity interest or similar transaction with respect to Oasis.
If either Oasis or the Oasis Shareholders signs a letter of intent or
other agreement in breach of this Section 7.02, and such transaction is
ultimately consummated, then, immediately upon the closing of such transaction,
Oasis shall forfeit to Rainwire the amount of Financing that had been provided
to Rainwire in accordance with 4.05 at the time of the breach. The Parties
27
agree that this amount is in consideration for Rainwire's expenses and lost
opportunities in connection with a breach of this Section 7.02 by Oasis and
shall not be construed as a penalty.
SECTION 7.03. AFFIRMATIVE COVENANTS OF OASIS. From the date hereof
until the earlier of the Effective Time or the termination of this Agreement,
Oasis covenants and agrees that, unless the prior written consent of Rainwire
shall have been obtained, and except as otherwise expressly contemplated herein,
Oasis shall:
(a) operate its business only in the usual, regular, and
ordinary course of business, consistent with past practices;
(b) use reasonable commercial efforts to preserve intact
its business organization, licenses, permits, government programs,
private programs and customers;
(c) use reasonable commercial efforts to retain the
services of its employees, agents and consultants on terms and
conditions not less favorable than those existing prior to the date
hereof and to ensure that there are no material or adverse changes to
employee relations;
(d) keep and maintain its assets in their present
condition, repair and working order, except for normal depreciation and
wear and tear, and maintain its insurance, rights and licenses;
(e) pay all accounts payable of Oasis in accordance with
past practice and collect all accounts receivable in accordance with
past practice;
(f) consult with Rainwire prior to undertaking any new
business opportunity outside the ordinary course of business and not
undertake such new business opportunity without the prior written
consent of Rainwire;
(g) make available to Rainwire true and correct copies of
all internal management and control reports (including aging of
accounts receivable, listings of accounts payable, and inventory
control reports) and financial statements related to Oasis and
furnished to management of Oasis;
(h) cause all tax returns that have not been filed prior
to the date hereof to be prepared and filed on or before the date such
tax return is required to be filed (taking into account any extensions
of the filing deadlines granted); provided, however, that any such tax
return shall not be filed without a reasonable opportunity for prior
review and comment by Rainwire;
(i) as soon as reasonably practicable after they become
available, but in no event more than 30 days following the end of each
calendar month, deliver to Rainwire true and complete copies of its
monthly financial statements for each calendar month ending subsequent
to the date hereof on the format historically utilized by Oasis;
28
(j) perform in all material respects all obligations
under agreements relating to or affecting its assets, properties or
rights;
(k) keep in full force and effect present insurance
policies or other comparable insurance coverage; and
(l) notify Rainwire of (i) any event or circumstance
which has caused or constituted, or is reasonably likely to have a
Oasis Material Adverse Effect or would cause or constitute, a breach of
any of the representations, warranties or covenants contained herein by
Oasis or the Oasis Shareholders; or (ii) any material change in the
normal course of business or in the operation of the assets, and of any
governmental complaints, investigations or hearings (or communications
indicating that the same may be contemplated), adjudicatory
proceedings, budget meetings or submissions involving Oasis or any
material property of Oasis. Oasis agrees to keep Rainwire fully
informed of such events and to permit Rainwire's representatives prompt
access to all materials prepared in connection therewith.
SECTION 7.04. NEGATIVE COVENANTS OF OASIS. From the date hereof until
the earlier of the Effective Time or the termination of this Agreement, Oasis
covenants and agrees that it will not do any of the following without the prior
written consent of Rainwire:
(a) take any action which would (i) adversely affect the
ability of any party to the Share Exchange Documents to obtain any
consents required for the transactions contemplated thereby, or (ii)
adversely affect the ability of any party hereto to perform its
covenants and agreements under the Share Exchange Documents;
(b) amend any of its organizational or governing
documents;
(c) incur any additional debt obligation or other
obligation for borrowed money except in the ordinary course of the
business of Oasis consistent with past practices, or impose, or suffer
the imposition, on any asset of Oasis of any lien or permit any such
lien to exist;
(d) repurchase, redeem, or otherwise acquire or exchange,
directly or indirectly, any Oasis Common Stock, or declare or pay any
dividend or make any other distribution in respect of Oasis Common
Stock;
(e) other than pursuant to the Share Exchange Documents,
issue, sell, pledge, encumber, authorize the issuance of, enter into
any contract to issue, sell, pledge, encumber, or authorize the
issuance of, or otherwise permit to become outstanding, any additional
Oasis Common Stock or any rights with respect to any Oasis Common
Stock;
(f) purchase or acquire any assets or properties, whether
real or personal, tangible or intangible, or sell or dispose of any
assets or properties, whether real or personal, tangible or intangible,
except in the ordinary course of business and consistent with past
practices;
29
(g) adjust, split, combine or reclassify any Oasis Common
Stock or issue or authorize the issuance of any other securities in
respect of or in substitution for Oasis Common Stock, or sell, lease,
mortgage or otherwise dispose of or otherwise encumber any asset having
a book value in excess of $50,000 other than in the ordinary course of
business for reasonable and adequate consideration;
(h) purchase any securities or make any material
investment, either by purchase of stock or other securities,
contributions to capital, asset transfers, or purchase of any assets,
in any entity, or otherwise acquire direct or indirect control over any
other entity;
(i) grant any increase in compensation or benefits to the
employees or officers of Oasis, except in accordance with past
practice; pay any severance or termination pay or any bonus other than
pursuant to written policies or written contracts in effect as of the
date hereof and disclosed on the Schedules hereto; enter into or amend
any severance agreements with officers of Oasis; or grant any material
increase in fees or other increases in compensation or other benefits
to directors of Oasis except in accordance with past practice;
(j) other than as contemplated by this Agreement or as
set forth on Schedule 7.04, enter into or amend any employment contract
between Oasis and any person or entity (unless such amendment is
required by law) that Oasis does not have the unconditional right to
terminate without liability (other than liability for services already
rendered), at any time on or after the Effective Time;
(k) adopt any new employee benefit plan or make any
material change in or to any existing employee benefit plans other than
any such change that is required by law or that, in the opinion of
counsel, is necessary or advisable to maintain the tax qualified status
of any such plan;
(l) make any significant change in any tax or accounting
methods or systems of internal accounting controls, except as may be
appropriate to conform to changes in tax laws or regulatory accounting
requirements or GAAP;
(m) commence any litigation other than in accordance with
past practice, settle any litigation involving any liability of Oasis
for material money damages or restrictions upon the operations of
Oasis;
(n) except as set forth on Schedule 7.04, modify, amend
or terminate any material contract or waive, release, compromise or
assign any material rights or claims;
(o) except in the ordinary course of business and, even
if in the ordinary course of business, then not in an amount to exceed
$25,000 in the aggregate, make or commit to make any capital
expenditure, or enter into any lease of capital equipment as lessee or
lessor;
(p) take any action, or omit to take any action, which
would cause any of the representations and warranties contained in
Article V to be untrue or incorrect;
30
(q) make any loan to any person or increase the aggregate
amount of any loan currently outstanding to any person; and
(r) shall not agree, in writing or otherwise, to take any
of the foregoing actions or take any action that would result in any of
the conditions to the Share Exchange not being satisfied, or, except as
otherwise allowed hereunder, that could reasonably be expected to
prevent, impede, interfere with or significantly delay the transactions
contemplated hereby.
SECTION 7.05. AFFIRMATIVE COVENANTS OF RAINWIRE. From the date hereof
until the earlier of the Effective Time or the termination of this Agreement,
Rainwire covenants and agrees that, unless the prior written consent of Oasis
shall have been obtained, and except as otherwise expressly contemplated herein,
Rainwire shall and shall cause each of its Subsidiaries to:
(a) use reasonable commercial efforts to preserve intact
its business organization, licenses, permits, government programs,
private programs and customers; and
(b) notify Oasis of (i) any event or circumstance which
has caused or constituted, or is reasonably likely to have an Rainwire
Material Adverse Effect or would cause or constitute, a breach of any
of Rainwire's representations, warranties or covenants contained
herein; or (ii) any material change in the normal course of business or
in the operation of Rainwire's assets, and of any material governmental
complaints, investigations or hearings (or communications indicating
that the same may be contemplated) or adjudicatory proceedings.
SECTION 7.06. NEGATIVE COVENANTS OF RAINWIRE. From the date hereof
until the earlier of the Effective Time or the termination of this Agreement,
Rainwire covenants and agrees that neither Rainwire nor any of its Subsidiaries,
will do any of the following without the prior written consent of Oasis:
(a) take any action which would (i) adversely affect the
ability of any party to the Share Exchange Documents to obtain any
consents required for the transactions contemplated thereby, or (ii)
adversely affect the ability of any party hereto to perform its
covenants and agreements under the Share Exchange Documents;
(b) take any action, or omit to take any action, which
would cause any of the representations and warranties contained in
Article VI to be untrue or incorrect.
SECTION 7.07. CONFIDENTIALITY. Rainwire and Oasis agree that each shall
hold in confidence any confidential information about the other that it has
received, or hereafter receives, pursuant to any provision of this Agreement
under circumstances indicating the confidentiality of such information unless
(a) such information shall have been publicly disclosed other than as a result
of any wrongful action by the recipient of such information or (b) the recipient
of such information independently develops or is aware of such information.
31
SECTION 7.08. PUBLIC ANNOUNCEMENTS. Rainwire, Oasis and the Oasis
Shareholders will consult with each other before issuing any press releases or
otherwise making any public statements or filings with governmental entities
with respect to this Agreement or the transactions contemplated hereby and shall
not issue any press releases or make any public statements or filings with
governmental entities prior to such consultation and shall modify any portion
thereof if the other party objects thereto, unless the same may be required by
applicable law.
SECTION 7.09. FILINGS WITH STATE OFFICES. Upon the terms and subject to
the conditions of this Agreement, Oasis and Rainwire shall execute and file a
Certificate of Share Exchange with the Secretary of State of the State of
Georgia in connection with the Closing.
SECTION 7.10. CONDITIONS TO CLOSING. The Oasis Shareholders, Oasis and
Rainwire agree to use their commercially reasonable best efforts to satisfy the
closing conditions set forth in Articles VIII and IX of this Agreement within
three (3) business days after all regulatory matters have been complied with.
SECTION 7.11. SALE OF SHARES.
(a) The Rainwire Common Stock to be issued in the Share
Exchange will be issued by Rainwire relying on an exemption from
registration pursuant to Section 4(2) under the Securities Act and
Regulation D thereunder or similar exemptions under the Securities Act
and that the certificates representing the shares of Rainwire Common
Stock shall bear appropriate legends to identify such shares as
"restricted securities" under the Securities Act, to comply with
applicable state securities laws. Each Oasis Shareholder acknowledges
and agrees that in order for Rainwire to rely on such exemptions from
registration, Rainwire will be required to obtain certain
representations made by the Oasis Shareholders including, but not
limited to, representations regarding limitations on resales of
Rainwire Common Stock.
(b) So long as required in the reasonable opinion of
Rainwire's counsel, stock transfer orders will be given to Rainwire's
Transfer Agent in connection with the certificates to be issued
representing Rainwire Common Stock and such certificates will bear
legends substantially as follows:
"THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND MAY NOT BE TRANSFERRED OR OTHERWISE DISPOSED OF, NOR WILL
ANY ASSIGNEE OR ENDORSEE HEREOF BE RECOGNIZED AS AN OWNER
HEREOF BY THE ISSUER FOR ANY PURPOSE, UNLESS A REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, WITH
RESPECT TO SUCH SHARES SHALL THEN BE IN EFFECT OR UNLESS THE
TRANSACTION IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF
SUCH ACT. IN ADDITION, THESE SECURITIES HAVE NOT BEEN
REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE
32
AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN A TRANSACTION
WHICH IS EXEMPT UNDER THE APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EFFECTIVE REGISTRATION OR QUALIFICATION UNDER
SUCH LAWS."
SECTION 7.12. [RESERVED].
SECTION 7.13. [RESERVED].
ARTICLE VIII
CONDITIONS TO OBLIGATIONS OF RAINWIRE
The obligation of Rainwire to consummate the Share Exchange is subject
to the satisfaction or written waiver, at or prior to Closing, of each of the
following conditions:
SECTION 8.01. REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Oasis and the Oasis Shareholders set forth in this Agreement, or
any document or instrument delivered to Rainwire hereunder, shall be true and
correct in all material respects as of the Effective Time with the same force
and effect as if such representations and warranties had been made at and as of
the Effective Time, except with respect to any of such representations and
warranties referring to a state of facts existing on a specified date prior to
the Closing Date, it shall be sufficient if at the Effective Time such
representation and warranty continues to describe accurately the state of facts
existing on the date so specified; provided, however, that Oasis and the Oasis
Shareholders shall have five days to cure any such material breach of a
representation or warranty (it being agreed that such five day period shall
commence as to such breach upon Rainwire becoming aware thereof and that
disclosure of a matter subsequent to the date hereof shall not constitute a
cure).
SECTION 8.02. PERFORMANCE; COVENANTS. All of the terms, covenants and
conditions of the Share Exchange Documents to be complied with or performed by
Oasis or the Oasis Shareholders at or prior to Closing shall have been complied
with and performed in all material respects including, but not limited to, the
delivery of the following documents:
(a) A good standing certificate regarding Oasis,
certified by the Secretary of State of the respective state of
incorporation and all states where such entity is qualified to do
business, dated within 30 business days of the Closing;
(b) A certificate dated as of the Closing Date signed by
the duly authorized officers of Oasis certifying that the
representations and warranties of Oasis set forth herein are true and
correct in all material respects as of the Effective Time and that
Oasis and each of the Oasis Shareholders have fulfilled all of the
conditions of this Article VIII;
(c) Written consents of all third parties necessary for
the consummation of the transactions contemplated by the Share Exchange
Documents;
33
(d) Resolutions duly adopted by Oasis (Board and
shareholder) approving the execution, delivery and performance of this
Agreement and the consummation of the Share Exchange, certified by an
appropriate officer of Oasis; and
(e) All books and records of Oasis, including all
corporate and other records, minute books, stock record books, stock
registers, books of accounts, contracts, agreements and such other
documents or certificates as shall be reasonably requested by Rainwire,
which the parties acknowledge will at the Closing be located at the
corporate offices of Oasis.
SECTION 8.03. NECESSARY CONSENTS AND APPROVALS. Rainwire, Oasis and the
Oasis Shareholders shall have obtained all licenses, consents and permits,
provided all notices, and all waiting periods required by Law, shall have
expired, necessary in order for Rainwire and Oasis to consummate the Share
Exchange.
SECTION 8.04. NO MATERIAL ADVERSE CHANGE. There shall not have occurred
a Oasis Material Adverse Effect between the date hereof and the Effective Time
or a material change in the financial condition of Oasis as represented in the
Oasis Financial Statements and the Schedules attached to this Agreement.
SECTION 8.05. NO INJUNCTION, ETC. No action, proceeding, investigation
or legislation shall have been instituted, threatened or proposed before any
court, governmental agency, or legislative body to enjoin, restrain, prohibit or
obtain substantial damages in respect of, or which is related to, arises out of,
this Agreement or the consummation of the Share Exchange, or which is related to
or arises out of the business or operations of Oasis, if such action,
proceeding, investigation or legislation, in the reasonable judgment of Rainwire
or its counsel, would make it inadvisable to consummate such transactions. In
the event any order, decree or injunction shall have been issued, each party
shall use its reasonable efforts to remove any such order, decree or injunction.
SECTION 8.06. INVESTOR REPRESENTATION LETTERS. The Oasis Shareholders
that did not deliver Investor Representation Letters on the date of signing of
this Agreement shall have delivered Investment Representation Letters.
SECTION 8.07. OASIS SHAREHOLDER APPROVAL. This Agreement and all other
documents and instruments to be delivered in connection herewith, shall have
been approved by the Oasis Shareholders in accordance with GBCC.
SECTION 8.08. [RESERVED].
SECTION 8.09. CERTIFICATE OF SHARE EXCHANGE. Oasis shall have executed
and delivered to Rainwire the Certificate of Share Exchange to be filed with the
Secretary of State of the State of Georgia in connection with the Share
Exchange.
SECTION 8.10. TAX-FREE SHARE EXCHANGE. The Parties are reasonably
satisfied that as of the Closing Date, the transactions contemplated by the
Share Exchange will qualify as a tax-free reorganization within the meaning of
Section 368(a) of the Code.
34
SECTION 8.11. EVIDENCE OF COMPLIANCE WITH SECURITIES LAWS. Rainwire
shall be reasonably satisfied that the issuance of Rainwire Common Stock to the
Oasis Shareholders qualifies for an exemption from registration pursuant to
Section 4(2) under the Securities Act and Regulation D thereunder.
ARTICLE IX
CONDITIONS TO OBLIGATIONS OF OASIS AND OASIS SHAREHOLDERS
The obligations of Oasis and the Oasis Shareholders to close the Share
Exchange are subject to the satisfaction or waiver, at or prior to Closing, of
each of the following conditions:
SECTION 9.01. REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Rainwire set forth in this Agreement, or any document or
instrument delivered to any party hereunder, shall be true and correct in all
material respects as of the Effective Time with the same force and effect as if
such representations and warranties had been made at and as of the Effective
Time, except with respect to any of such representations and warranties
referring to a state of facts existing at a specified date prior to the Closing
Date, it shall be sufficient if at the Effective Time such representation and
warranty continues to describe accurately in all material respects the state of
facts existing on the date so specified; provided, however, that Rainwire shall
have five days to cure any such material breach of a representation or warranty
(it being agreed that such five day period shall commence as to such breach upon
Oasis becoming aware thereof and that disclosure of a matter subsequent to the
date hereof shall not constitute a cure).
SECTION 9.02. PERFORMANCE; COVENANTS. All of the terms, covenants and
conditions of this Agreement to be complied with or performed by Rainwire at or
prior to the Closing shall have been complied with and performed in all material
respects, including, but not limited to delivery of the following documents:
(a) A good standing certificate regarding Rainwire
certified by the Secretary of State of the State of Delaware, dated
within 30 days prior to Closing;
(b) A certificate dated as of the Closing Date signed by
a duly authorized officer of Rainwire certifying that the
representations and warranties of Rainwire set forth herein are true
and correct in all material respects as of the Effective Time and that
Rainwire has fulfilled all of the conditions of this Article; and
(c) Resolutions duly adopted by the Board of Directors of
Rainwire approving the execution, delivery and performance of this
Agreement and the consummation of the Share Exchange, certified by an
appropriate officer of Rainwire;
SECTION 9.03. NECESSARY CONSENTS AND APPROVALS. Rainwire, Oasis and the
Oasis Shareholders shall have obtained all licenses, consents and permits,
provided all notices, and all waiting periods required by Law, shall have
expired, necessary in order for Rainwire and Oasis to consummate the Share
Exchange, including the waiting period associated with the Schedule 14C filed,
or to be filed, by Rainwire in connection with the Amendment.
35
SECTION 9.04. NO MATERIAL ADVERSE CHANGE. There shall not have occurred
an Rainwire Material Adverse Effect between the date hereof and the Effective
Time.
SECTION 9.05. NO INJUNCTION, ETC. No action, proceeding, investigation
or legislation shall have been instituted, threatened or proposed before any
court, governmental agency, or legislative body to enjoin, restrain, prohibit or
obtain substantial damages in respect of, or which is related to, arises out of,
this Agreement or the consummation of the Share Exchange, or which is related to
or arises out of the business or operations of Rainwire, if such action,
proceeding, investigation or legislation, in the reasonable judgment of Oasis or
its counsel, would make it inadvisable to consummate such transactions. In the
event any order, decree or injunction shall have been issued, each party shall
use its reasonable efforts to remove any such order, decree or injunction.
SECTION 9.06. SECURITIES FILINGS. Rainwire shall have filed with the
SEC its Annual Report on Form 10-KSB for the fiscal year ending December 31,
2000, its Quarterly Report on Form 10-QSB for the quarter ended March 31, 2001,
and its Quarterly Report on form 10-QSB for the quarter ended June 30, 2001.
SECTION 9.07. CERTIFICATE OF SHARE EXCHANGE. Rainwire shall have
executed and delivered to Oasis the certificate of share exchange to be filed
with the Secretary of State of the State of Georgia in connection with the Share
Exchange.
SECTION 9.08. TAX-FREE SHARE EXCHANGE. The Parties are reasonably
satisfied that as of the Closing Date, the transactions contemplated by the
Share Exchange will qualify as a tax-free reorganization within the meaning of
Section 368(a) of the Code.
SECTION 9.09. EMPLOYMENT AGREEMENTS. Upon execution of this Agreement,
and as a result of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ resignation, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇'▇ employment
agreement with Rainwire shall be terminated.
SECTION 9.10. RAINWIRE SHAREHOLDER APPROVAL. Rainwire shall have taken
all steps required by the GCDL and the federal securities laws to obtain the
consent of a majority of its shareholders in favor of the Amendment and to
notify the remaining shareholders of the Amendment.
ARTICLE X
TERMINATION
SECTION 10.01. RIGHT OF TERMINATION. This Agreement and the Share
Exchange may be terminated at any time prior to the Closing Date:
(a) By the mutual written consent of Rainwire and Oasis.
(b) by either Rainwire or Oasis if any court of competent
jurisdiction in the United States or any State shall have issued an
order, judgment or decree (other than a temporary restraining order)
restraining, enjoining or otherwise prohibiting the exchange
36
of stock and such order, judgment or decree shall have become final and
nonappealable; provided that the right to terminate this Agreement
under this Section 10.01(b) shall not be available to any party whose
failure to fulfill any obligation under this Agreement has been the
cause of, or resulted in, the failure of the completion of the Closing
to occur on or before such date; or
(c) by Rainwire if there has been (i) a material breach
of any covenant or agreement or of a representation or warranty herein
on the part of Oasis which has not been cured, or adequate assurance
(acceptable to Rainwire in its sole discretion) of cure given, in
either case, within fifteen (15) business days following receipt of
notice of such breach; or
(d) by Oasis if (i) there has been a material breach of
any covenant or agreement or of a representation or warranty herein on
the part of Rainwire which has not been cured, or adequate assurance
(acceptable to Oasis in its sole discretion) of cure given, in either
case, within fifteen (15) business days following receipt of notice of
such breach or (ii) at Closing Rainwire shall not be listed on the
Over-the-Counter Bulletin Board (OTC:BB) exchange; or
(e) by either Rainwire or Oasis (and the Oasis
Shareholders) if either of such party's due diligence investigation has
disclosed the existence of (i) any matter relating to the other party
or its business that is materially and adversely (to the investigating
party) at variance with those matters theretofore disclosed to the
investigating party, or (ii) any matter which, in the investigating
party's reasonable judgment, (A) indicates a material adverse change in
the condition, assets or prospects of the other party, or (B) would
make it inadvisable to consummate the exchange of stock and other
transactions contemplated by this Agreement.
SECTION 10.02. EFFECT OF TERMINATION. In the event of termination in
accordance with this Article X, this Agreement shall become void and of no
further force or effect, without any liability on the part of any of the parties
hereto or their respective owners, directors, officers or employees, except the
obligations of each party to preserve the confidentiality of documents,
certificates and information furnished to such party pursuant thereto and for
any obligation or liability of any party based on or arising from any breach or
default by any such party with respect to his or its particular representations,
warranties, covenants or agreements, as to his or its particular actions or
inactions, contained in the Share Exchange Documents.
ARTICLE XI
SURVIVAL OF TERMS; INDEMNIFICATION
SECTION 11.01. INDEMNIFICATION BY RAINWIRE. Rainwire shall defend,
indemnify and hold harmless Oasis and the Oasis Shareholders and their
respective heirs, personal and legal representatives, guardians, successors and
assigns, from and against any and all claims, threats, liabilities, taxes,
interest, fines, penalties, suits, actions, proceedings, demands, damages,
losses, costs and expenses (including attorneys' and experts' fees and court
costs) of every kind and
37
nature arising out of, resulting from or in connection with any
misrepresentation or omission or breach by Rainwire of any representation or
warranty contained in this Agreement.
SECTION 11.02. INDEMNIFICATION BY OASIS AND THE OASIS SHAREHOLDERS.
Oasis and the Oasis Shareholders shall defend, indemnify and hold harmless
Rainwire and its respective representatives, successors and assigns, from and
against any and all claims, threats, liabilities, taxes, interest, fines,
penalties, suits, actions, proceedings, demands, damages, losses, costs and
expenses (including attorneys' and experts' fees and court costs) of every kind
and nature arising out of, resulting from, or in connection with any
misrepresentation or omission or breach by Oasis or the Oasis Shareholders or
any representation or warranty contained in this Agreement.
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.01. NOTICES.
(a) Any notice sent in accordance with the provisions of
this Section 12.01 shall be deemed to have been received (even if
delivery is refused or unclaimed) on the date which is: (i) the date of
proper posting, if sent by certified U.S. mail or by express U.S. mail
or private overnight courier; or (ii) the date on which sent, if sent
by facsimile transmission, with confirmation and with the original to
be sent by certified U.S. mail, addressed as follows:
If to Oasis: Oasis Group, Inc.
[TO BE PROVIDED]
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: [TO BE PROVIDED]
If to Rainwire: Rainwire Partners, Inc.
[TO BE PROVIDED]
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Facsimile: [TO BE PROVIDED]
(b) Any party hereto may change its address specified for
notices herein by designating a new address by notice in accordance
with this Section 12.01.
SECTION 12.02. EXPENSES. Each of the parties hereto shall bear and pay
all costs and expenses incurred by it or on its behalf in connection with the
transactions contemplated hereunder, including any fees of brokers, finders
investment bankers or other agents or incurred to obtain a fairness opinion;
provided, however, for all legal, accounting, investment banking and other fees
and expenses incurred by Oasis and the Oasis Shareholders as a result of the
transactions contemplated hereby, Oasis shall pay from its own funds the fees
and expenses of the Oasis Shareholders prior to the Closing, or to the extent
not so paid, then Oasis shall pay such fees and expenses after the Closing when
due.
38
SECTION 12.03. FURTHER ASSURANCES. Each party covenants that at any
time, and from time to time, after the Closing, it will execute such additional
instruments and take such actions as may be reasonably requested by the other
parties to confirm or perfect or otherwise to carry out the intent and purposes
of this Agreement.
SECTION 12.04. WAIVER. Any failure on the part of any party to comply
with any of its obligations, agreements or conditions hereunder may be waived by
any other party to whom such compliance is owed. No waiver of any provision of
this Agreement shall be deemed, or shall constitute, a waiver of any other
provision, whether or not similar, nor shall any waiver constitute a continuing
waiver.
SECTION 12.05. ASSIGNMENT. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties hereto without the prior written consent of all other parties.
SECTION 12.06. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs, legal
representatives, executors, administrators, successors and permitted assigns.
This Agreement shall survive the Closing and not be merged therein.
SECTION 12.07. HEADINGS. The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
SECTION 12.08. ENTIRE AGREEMENT. This Agreement and the Exhibits,
Schedules, certificates and other documents delivered pursuant hereto or
incorporated herein by reference, contain and constitute the entire agreement
among the parties and supersede and cancel any prior agreements,
representations, warranties, or communications, whether oral or written, among
the parties relating to the transactions contemplated by this Agreement. Neither
this Agreement nor any provision hereof may be changed, waived, discharged or
terminated orally, but only by an agreement in writing signed by the party
against whom or which the enforcement of such change, waiver, discharge or
termination is sought.
SECTION 12.09. GOVERNING LAW; SEVERABILITY. This Agreement shall be
governed by and construed in accordance with the Laws of the State of Georgia,
without regard to any applicable conflicts of Laws. The provisions of this
Agreement are severable and the invalidity of one or more of the provisions
herein shall not have any effect upon the validity or enforceability of any
other provision.
SECTION 12.10. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
SECTION 12.11. BROKERS AND FINDERS. Except as set forth on Schedule
12.11, neither Oasis nor the Oasis Shareholders on the one hand, or Rainwire on
the other hand, has employed or otherwise incurred in any manner any liability
for any brokerage fees, agents commissions or finder's fees concerning the
transactions contemplated hereby.
39
SECTION 12.12. SCHEDULES AND EXHIBITS. All Schedules and Exhibits
attached to this Agreement are by reference made a part hereof. All Schedules
will be attached to this Agreement prior to the Closing. All Exhibits will be
attached to this Agreement within five (5) after this Agreement is signed by all
parties.
SECTION 12.13. ENFORCEMENT OF AGREEMENT. Except as otherwise provided
herein, any and all remedies herein expressly conferred upon a party will be
deemed cumulative with and not exclusive of any other remedy conferred hereby,
or by law or equity upon such party, and the exercise by a party of any one
remedy will not preclude the exercise of any other remedy. Oasis hereto agrees
that money damages or other remedy at law would not be sufficient or adequate
remedy for any breach or violation of, or a default under, this Agreement by
them and that in addition to all other remedies available to Rainwire, Rainwire
shall be entitled to the fullest extent permitted by law to an injunction
restraining such breach, violation or default or threatened breach, violation or
default and to any other equitable relief, including, without limitation,
specific performance, without bond or other security being required.
ARTICLE XIII
CERTAIN DEFINITIONS
Except as otherwise provided herein, the capitalized terms set forth
below shall have the following meanings:
"Affiliate" shall mean, with regard to any Person, (a) any Person,
directly or indirectly, controlled by, under common control of, or controlling
such Person, (b) any Person, directly or indirectly, in which such Person holds,
of record or beneficially, five percent or more of the equity or voting
securities, (c) any Person that holds, of record or beneficially, five percent
or more of the equity or voting securities of such Person, (d) any Person that,
through Contract, relationship or otherwise, exerts a substantial influence on
the management of such Person's affairs, (e) any Person that, through Contract,
relationship or otherwise, is influenced substantially in the management of
their affairs by such Person, or (f) any director, officer, partner or
individual holding a similar position in respect of such Person.
"Agreement" shall mean the Agreement and Plan of Share Exchange.
"Authority" shall mean any governmental, regulatory or administrative
body, agency, arbitrator or authority, any court or judicial authority, any
public, private or industry regulatory agency, arbitrator authority, whether
international, national, federal, state or local.
"Claim" shall have the meaning set forth in Section 5.09.
"Closing Date" shall have the meaning set forth in Section 1.02.
"Closing" shall mean the meaning set forth in Section 1.02.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
40
"GCDL" shall mean the General Corporation Law of the State of Delaware.
"Effective Time" shall have the meaning set forth in Section 1.03.
"ERISA" shall mean the Employee Retirement Security Act of 1974, as
amended.
"Exchange Agent" shall have the meaning set forth in Section 3.01.
"Exchange Ratio" shall have the meaning set forth in Section 2.02.
"GBCC" shall mean the Georgia Business Corporation Code, as amended.
"Intellectual Property" shall mean all letters patent, patent
applications, inventions upon which patent applications have not yet been filed,
trade names, trademarks, trademark registrations and applications, service
marks, service ▇▇▇▇ registrations and applications, copyrights and copyright
registrations and applications, both domestic and foreign, owned, possessed or
used by Borrower.
"Investor Representation Letter" shall have the meaning set forth in
the Preamble of this Agreement.
"Knowledge" or "known," "to the knowledge of," or similar references
shall mean the actual knowledge of any of the directors, officers or managerial
personnel of Oasis with respect to the matter in question, and such knowledge as
any of the directors, officers or managerial personnel of Oasis reasonably
should have obtained upon diligent investigation and inquiry into the matter in
question.
"Lien" shall mean any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, encumbrance (including, without limitation, any
easement, right-of-way, zoning or similar restriction or title defect), lien
(statutory or other) or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC or comparable
law of any jurisdiction).
"Oasis" shall mean Oasis Group, Inc., a Georgia corporation.
"Oasis Agreements" shall have the meaning set forth in Section 5.12.
"Oasis Common Stock" shall mean the Common Stock, no par value, of
Oasis.
"Oasis Material Adverse Effect" shall have mean a material adverse
effect on (a) Oasis's ability to perform its obligations under the Share
Exchange Documents to be executed and delivered by it or (b) the assets, results
of operations or prospects of Oasis taken as a whole.
"Oasis Shareholders" shall mean those persons listed on Schedule 1 of
this Agreement.
41
"Person" shall mean any corporation, partnership, joint venture, Oasis,
syndicate, organization, association, trust, entity, joint stock Oasis,
unincorporated organization, Authority or natural person.
"Rainwire" shall mean Rainwire Partners, Inc., a Delaware corporation.
"Rainwire Common Stock" shall mean the common stock, $.001 par value,
of Rainwire.
"Rainwire Material Adverse Effect" shall mean a material adverse effect
on (a) Rainwire's ability to perform its obligations under the Share Exchange
Documents to be executed and delivered by it or, (b) the assets, results of
operations or prospects of Rainwire and its Subsidiaries taken as a whole.
"SEC Reports" shall have the meaning set forth in Section 6.06.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Share Exchange" shall have the meaning set forth in Section 1.01.
"Share Exchange Documents" shall have the meaning set forth in Section
5.01.
"Shareholders" shall mean all of the holders of Oasis Common Stock.
"Subsidiary" shall mean any Person of which a majority of the
outstanding voting securities or other voting equity interests are owned,
directly or indirectly.
"Tax Return" means any return, declaration, report, claim for refund or
information return or statement relating to Taxes, including any schedule or
attachment thereto and including any amendment thereof.
"Tax" shall mean any Federal, state, local or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Section 59A of
the Code), customs duties, capital stock, franchise, profits, withholding,
social security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or add-on
minimum, estimated or other tax of any kind whatsoever, including any interest,
penalty or addition thereto, whether disputed or not, and "Taxes" means any or
all of the foregoing collectively.
Any singular term in this Agreement shall be deemed to include the
plural, and any plural term the singular. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they shall be deemed
followed by the words "without limitation."
42
[Signature page to Agreement and Plan of Share Exchange]
IN WITNESS WHEREOF, each of the Parties has caused this Agreement and
Plan of Share Exchange to be executed on its behalf and its corporate seal to be
hereunto affixed and attested by officers thereunto as of the day and year first
above written.
RAINWIRE PARTNERS, INC.
By
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Name
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Title
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OASIS GROUP, INC.
By
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Name
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Title
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[Signatures continued on following page]
[Signature page to Agreement and Plan of Share Exchange
for Oasis Shareholders]
OASIS SHAREHOLDER
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Name
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[Signatures continued on following page]
[Signature page to Agreement and Plan of Share Exchange
for Oasis Shareholders]
OASIS SHAREHOLDER
By
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Name
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Title
---------------------------------