Exhibit 10.1
Share Exchange Agreement
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SHARE EXCHANGE AGREEMENT
by and among
LEXICON UNITED INCORPORATED,
as Acquiror
ATN CAPITAL & PARTICIPACOES LTDA.
as the acquired Company
and
the Shareholders of
ATN CAPITAL & PARTICIPACOES LTDA.
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SHARE EXCHANGE AGREEMENT
SHARE EXCHANGE AGREEMENT, dated December 12, 2005 by and among LEXICON
UNITED INCORPORATED, a Delaware corporation (hereinafter referred to as
"Lexicon"), ATN CAPITAL & PARTICIPACOES LTDA, a Brazilian limited company
(hereinafter referred to as the "Company"), and ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ Fraguas, each shareholders of the Company (hereinafter referred
to as the "Shareholders").
RECITALS:
A. The Shareholders own, in the aggregate one hundred percent (100%) of
the issued and outstanding capital stock of the Company and will be exchanging
pursuant to this Agreement Four Hundred Thousand (400,000) shares of the
Company's capital stock (the "Shares") constituting 80% of the Company's issued
and outstanding capital stock in the aggregate.
B. Lexicon is willing to acquire the Shares making the Company a
majority-owned subsidiary of Lexicon, and the Shareholders desire to exchange
their shares for cash and shares of Lexicon's authorized but unissued Common
Stock as hereinafter provided.
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained in this Agreement, the parties hereto
agree as follows:
1. EXCHANGE OF SHARES
1.1 Exchange of Shares and Cash Consideration. Lexicon is paying to the
Shareholders on the date hereof cash in immediately available funds in the
amount of One Hundred and Seven Thousand, Six Hundred and Ninety-Two Dollars
($107,692.00), in the aggregate, as partial consideration for the Shares. If the
Closing does not occur for any reason, then the Shareholders must immediately
return such cash amount without interest. Lexicon and the Shareholders hereby
agree that the Shareholders shall, on the Closing Date (as hereinafter defined),
exchange the Shares for 2,000,000 shares, in the aggregate, of Lexicon Common
Stock, $0.001 par value (the "Lexicon Shares"). The number of shares of capital
stock owned by the Shareholders and the number of Lexicon Shares and cash which
the Shareholders will be entitled to receive in the Exchange is set forth in
Exhibit A hereto.
1.2 Delivery of Shares. On the Closing Date, the Shareholders will
deliver to Lexicon the certificates representing the Shares, duly endorsed (or
with executed stock powers) so as to make Lexicon the sole owner thereof.
Simultaneously, Lexicon will deliver certificates representing the Lexicon
Shares to the Shareholders.
1.3 Investment Intent. The Lexicon Shares have not been registered
under the Securities Act of 1933, as amended, and may not be resold unless the
Lexicon Shares are registered under the Act or an exemption from such
registration is available. The Shareholders represent and warrant that they are
acquiring the Lexicon Shares for their own account, for investment, and not with
a view to the sale or distribution of such Shares. Each certificate representing
the Lexicon Shares will have a legend thereon referring to the transfer
restrictions of the Securities Act of 1933, as amended.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SHAREHOLDERS
The Company and the Shareholders hereby jointly, and severally,
represent and warrant that, the statements contained in this Section 2 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this Section 2),
except as set forth in the disclosure schedule attached hereto as Schedule B
hereto (the "Disclosure Schedule"). The Disclosure Schedule will be arranged in
paragraphs corresponding to the lettered and numbered paragraphs contained in
this Section 2.
2.1 Organization and Good Standing; Ownership of Shares. The Company is
a limited company duly organized, validly existing and in good standing under
the laws of Brazil, and is entitled to own or lease its properties and to carry
on its business as and in the places where such properties are now owned, leased
or operated and such business is now conducted. The Company does not have any
subsidiaries. There are no outstanding subscriptions, rights, options, warrants
or other agreements obligating either the Company or the Shareholders to issue,
sell or transfer any stock or other securities of the Company.
2.2 Ownership of Shares. The Shareholders are the owners of record and
beneficially of the Shares, all of which Shares are free and clear of all
rights, claims, liens and encumbrances, and have not been sold, pledged,
assigned or otherwise transferred except pursuant to this Agreement. Section 2.2
of the Disclosure Schedule contains a true and accurate list of all of the
stockholders of the Company and the number of shares of the Company's capital
stock held by each stockholder. The Shares constitute Eighty Percent (80%) of
the issued and outstanding share capital of the Company on the date hereof.
2.3 Financial Statements, Books and Records. There has been previously
delivered to Lexicon the audited balance sheets of the Company as at December
31, 2004 (the "Balance Sheet") and December 31, 2003, and the related audited
statement of operations and retained earnings and cash flows for the periods
then ended (the "Financial Statements"). The Financial Statements are true and
accurate and fairly represent the financial position of the Company as at such
dates and the results of its operations for the periods then ended.
2.4 No Material Adverse Changes. Since the date of the Balance Sheet
there has not been:
(i) any material adverse change in the assets, operations,
condition (financial or otherwise) or prospective business of the Company;
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(ii) any damage, destruction or loss materially affecting the
assets, prospective business, operations or condition (financial or otherwise)
of the Company, whether or not covered by insurance;
(iii) any declaration, setting aside or payment of any
dividend or distribution with respect to any redemption or repurchase of the
Company's capital stock;
(iv) any sale of an asset (other than in the ordinary course
of business) or any mortgage or pledge by the Company of any properties or
assets; or
(v) adoption of any pension, profit sharing, retirement, stock
bonus, stock option or similar plan or arrangement.
2.5 Taxes. The Company has prepared and filed all appropriate foreign,
federal, state and local tax returns for all periods prior to and through the
date hereof for which any such returns have been required to be filed by it and
has paid all taxes shown to be due by said returns or on any assessments
received by it or has made adequate provision for the payment thereof.
2.6 Compliance with Laws. The Company has complied with all foreign,
federal, state, county and local laws, ordinances, regulations, inspections,
orders, judgments, injunctions, awards or decrees applicable to it or its
business which, if not complied with, would materially and adversely affect the
business of the Company.
2.7 No Breach. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby will not:
(i) violate any provision of the charter documents or other
constituent instruments of the Company;
(ii) violate, conflict with or result in the breach of any of
the terms of, result in a material modification of, otherwise give any other
contracting party the right to terminate, or constitute (or with notice or lapse
of time or both constitute) a default under, any contract or other agreement to
which the Company is a party or by or to which it or any of its assets or
properties may be bound or subject;
(iii) violate any order, judgment, injunction, award or decree
of any court, arbitrator or governmental or regulatory body against, or binding
upon, the Company, or upon the properties or business of the Company; or
(iv) violate any statute, law or regulation of any
jurisdiction applicable to the transactions contemplated herein which could have
a materially adverse effect on the business or operations of the Company.
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2.8 Actions and Proceedings. There is no outstanding order, judgment,
injunction, award or decree of any court, governmental or regulatory body or
arbitration tribunal against or involving the Company. There is no action, suit
or claim or legal, administrative or arbitral proceeding or (whether or not the
defense thereof or liabilities in respect thereof are covered by insurance)
pending or threatened against or involving the Company or any of its properties
or assets.
2.9 Brokers or Finders. No broker's or finder's fee will be payable by
the Company in connection with the transactions contemplated by this Agreement,
nor will any such fee be incurred as a result of any actions by the Company or
the Shareholders.
2.10 Liabilities. The Company does not have any direct or indirect
indebtedness, liability, claim, loss, damage, deficiency, obligation or
responsibility, known or unknown, fixed or unfixed, liquidated or unliquidated,
secured or unsecured, accrued or absolute, contingent or otherwise, including,
without limitation, any liability on account of taxes, any other governmental
charge or lawsuit (all of the foregoing collectively defined to as
"Liabilities"), which were not fully, fairly and adequately reflected on the
Balance Sheet or in the Disclosure Schedule. As of the Closing Date, the Company
will not have any Liabilities, other than Liabilities fully and adequately
reflected on the Balance Sheet or the Disclosure Schedule, except for
Liabilities incurred in the ordinary course of business.
2.11 Operations of the Company. Except as set forth in the Disclosure
Schedule, since the date of the Balance Sheet and through the Closing Date, the
Company has not and will not have:
(i) incurred any indebtedness for borrowed money;
(ii) declared or paid any dividend or declared or made any
distribution of any kind to any shareholder, or made any direct or indirect
redemption, retirement, purchase or other acquisition of any shares in its
capital stock;
(iii) made any loan or advance to any shareholder, officer,
director, employee, consultant, agent or other representative or made any other
loan or advance otherwise than in the ordinary course of business;
(iv) except in the ordinary course of business, incurred or
assumed any indebtedness or liability (whether or not currently due and
payable);
(v) disposed of any assets of the Company except in the
ordinary course of business;
(vi) increased, terminated amended or otherwise modified any
plan for the benefit of employees of the Company;
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(vii) issued any equity securities or rights to acquire such
equity securities; or
(viii) except in the ordinary course of business, entered into
or modified any contract, agreement or transaction.
2.12 Real Estate. Except as set forth in the Disclosure Schedule, the
Company neither owns real property nor is a party to any leasehold agreement.
2.13 Tangible Assets. The Company has full title and interest in all
machinery, equipment, furniture, leasehold improvements, fixtures, vehicles,
structures, owned or leased by the Company, any related capitalized items or
other tangible property material to the business of the Company (the "Tangible
Assets"). The Company holds all rights, title and interest in all the Tangible
Assets owned by it on the most recent Balance Sheet or acquired by it after the
date of the most recent Balance Sheet, free and clear of all liens, pledges,
mortgages, security interests, conditional sales contracts or any other
encumbrances except as set forth in the Disclosure Schedule. All of the Tangible
Assets are in good operating condition and repair and are usable in the ordinary
course of business of the Company and conform to all applicable laws, ordinances
and governmental orders, rules and regulations relating to their construction
and operation.
2.14 Capitalization. The authorized capital stock of the Company
consists of 500,000 shares of common stock of which Five Hundred Thousand
(500,000) shares are presently issued and outstanding. Neither the Company nor
the Shareholders has granted, issued or agreed to grant, issue or make available
any warrants, options, subscription rights or any other commitments of any
character relating to the issued or unissued shares of capital stock of the
Company.
2.15 Investment Representations. (a) the Shareholders are acquiring the
Lexicon Shares for their own account for investment and not for the account of
any other person and not with a view to or for distribution, assignment or
resale in connection with any distribution within the meaning of the Securities
Act, (b) the Shareholders have knowledge and experience in financial and
business matters such that they are capable of evaluating the merits and risks
of an investment in Lexicon, (c) the Shareholders were provided the opportunity
ask questions and receive answers regarding the terms and conditions of the
offering and to obtain any additional information which we possessed or were
able to acquire without unreasonable effort and expense, and (d) the
Shareholders have adequate means of providing for their current needs and
possible personal contingencies, anticipate no need now or in the foreseeable
future to sell the shares and can afford the loss of the entire investment.
2.16 Full Disclosure. No representation or warranty by the Company or
the Shareholders in this Agreement will contain any untrue statement of a
material fact or omits or will omit to state any fact necessary to make any
statement herein not materially misleading or necessary to a complete and
correct presentation of all material aspects of the businesses of the Company.
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2.17 Representations and Warranties on Closing Date. The
representations and warranties contained in this Section 2 shall be true and
complete on the Closing Date with the same force and effect as though such
representations and warranties had been made on and as of the Closing Date.
3. REPRESENTATIONS AND WARRANTIES OF LEXICON
Lexicon hereby represents and warrants that, the statements contained
in this ?Section 3 are correct and complete as of the date of this Agreement and
will be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Section 3), except as set forth in the disclosure schedule
attached hereto as Schedule B hereto (the "Disclosure Schedule"). The Disclosure
Schedule will be arranged in paragraphs corresponding to the lettered and
numbered paragraphs contained in this 3.
3.1 Organization and Good Standing. Lexicon is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is entitled to own or lease its properties and to carry on its
business as and in the places where such properties are now owned, leased, or
operated and such business is now conducted. As of the Closing Date, the
authorized capital stock of Lexicon will consist of 50,000,000 shares, of which,
40,000,000 shares are designated as Common Stock, of which 6,456,250 shares will
be issued and outstanding immediately prior to the Closing, and 10,000,000
shares are designated as Preferred Stock, of which no shares will be issued and
outstanding immediately prior to the Closing. Lexicon is duly licensed or
qualified and in good standing as a foreign corporation where the character of
the properties owned by Lexicon or the nature of the business transacted by it
make such license or qualification necessary. Lexicon does not have any
subsidiaries.
3.2 The Lexicon Shares. The Lexicon Shares to be issued to the
Shareholders have been or will have been duly authorized for issuance by all
requisite corporate and stockholder action required under the General
Corporation Law of the State of Delaware and no other corporate or shareholder
action is required to authorize the Lexicon Shares for issuance and, when so
issued in accordance with the terms of this Agreement, the Lexicon Shares will
be validly issued, fully paid and non-assessable.
3.3 Financial Statements; Books and Records. There has been previously
delivered to the Company, the audited balance sheet of Lexicon as at December
31, 2004 and December 31, 2003 (the "Lexicon Balance Sheets") and the related
audited statements of operations and cash flows for the periods then ended (the
"Financial Statements"). The Financial Statements are true and accurate and
fairly represent the financial position of the Company as at such dates and the
results of its operations for the periods then ended, and have been prepared in
accordance with U.S. generally accepted accounting principles consistently
applied.
3.4 No Material Adverse Changes. Since the date of the most recent
Lexicon Balance Sheet and except as otherwise disclosed in the Disclosure
Schedule or in Lexicon's reports or filings made under the Securities Exchange
Act of 1934, there has not been:
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(i) any material adverse change in the assets, operations,
condition (financial or otherwise) or prospective business of Lexicon;
(ii) any damage, destruction or loss materially affecting the
assets, prospective business, operations or condition (financial or otherwise)
of Lexicon, whether or not covered by insurance;
(iii) any declaration, setting aside or payment of any
dividend or distribution with respect to any redemption or repurchase of
Lexicon's capital stock;
(iv) any sale of an asset (other than in the ordinary course
of business) or any mortgage or pledge by Lexicon of any properties or assets;
or
(v) adoption of any pension, profit sharing, retirement, stock
bonus, stock option or similar plan or arrangement.
3.5 Compliance with Laws. Lexicon has complied with all federal, state,
county and local laws, ordinances, regulations, inspections, orders, judgments,
injunctions, awards or decrees applicable to their businesses, including Federal
and State securities laws, which, if not complied with, would materially and
adversely affect the business of Lexicon or the trading market for the shares of
Lexicon's Common Stock.
3.6 No Breach. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby will not:
(i) violate any provision of the Articles of Incorporation or
By-Laws of Lexicon;
(ii) violate, conflict with or result in the breach of any of
the terms of, result in a material modification of, otherwise give any other
contracting party the right to terminate, or constitute (or with notice or lapse
of time or both constitute) a default under, any contract or other agreement to
which Lexicon is a party or by or to which it or any of its assets or properties
may be bound or subject;
(iii) violate any order, judgment, injunction, award or decree
of any court, arbitrator or governmental or regulatory body against, or binding
upon, Lexicon or upon the properties or business of Lexicon; or
(iv) violate any statute, law or regulation of any
jurisdiction applicable to the transactions contemplated herein which could have
a material adverse effect on the business or operations of Lexicon..
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3.7 Actions and Proceedings. There is no outstanding order, judgment,
injunction, award or decree of any court, governmental or regulatory body or
arbitration tribunal against or involving Lexicon. There is no action, suit or
claim or legal, administrative or arbitral proceeding or (whether or not the
defense thereof or liabilities in respect thereof are covered by insurance)
pending or threatened against or involving Lexicon or any of its properties or
assets. Except as set forth on Schedule 3.7, there is no fact, event or
circumstances that may give rise to any suit, action, claim, investigation or
proceeding.
3.8 Brokers or Finders. Except as set forth in the Disclosure Schedule,
no broker's or finder's fee will be payable by Lexicon in connection with the
transactions contemplated by this Agreement.
3.9 Liabilities. Lexicon does not have any direct or indirect
indebtedness, liability, claim, loss, damage, deficiency, obligation or
responsibility, known or unknown, fixed or unfixed, liquidated or unliquidated,
secured or unsecured, accrued or absolute, contingent or otherwise, including,
without limitation, any liability on account of taxes, any other governmental
charge or lawsuit (all of the foregoing collectively defined to as
"Liabilities"), which were not fully, fairly and adequately reflected on the
Lexicon Balance Sheet.
3.10 Operations of Lexicon. Except as set forth in the Disclosure
Schedule or in Lexicon' reports or filings made under the Securities Exchange
Act of 1934, since the date of the most recent Lexicon Balance Sheet and through
the Closing Date hereof, Lexicon has not and will not have:
(i) incurred any indebtedness for borrowed money;
(ii) declared or paid any dividend or declared or made any
distribution of any kind to any shareholder, or made any direct or indirect
redemption, retirement, purchase or other acquisition of any shares in its
capital stock;
(iii) made any loan or advance to any shareholder, officer,
director, employee, consultant, agent or other representative or made any other
loan or advance otherwise than in the ordinary course of business;
(iv) except in the ordinary course of business, incurred or
assumed any indebtedness or liability (whether or not currently due and
payable);
(v) disposed of any assets of Lexicon except in the ordinary
course of business; or
(vi) increased, terminated amended or otherwise modified any
plan for the benefit of employees of Lexicon;
(vii) issued any equity securities or rights to acquire such
equity securities; or
(viii) except in the ordinary course of business, entered into
or modified any contract, agreement or transaction.
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3.11 Authority to Execute and Perform Agreements. Lexicon has the full
legal right and power and all authority and approval required to enter into,
execute and deliver this Agreement and to perform fully their obligations
hereunder. This Agreement has been duly executed and delivered and is the valid
and binding obligation of Lexicon enforceable in accordance with its terms. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby and the performance by Lexicon of this
Agreement, in accordance with its respective terms and conditions will not:
(i) require the approval or consent of any governmental or
regulatory body, the Shareholders of Lexicon, or the approval or consent of any
other person;
(ii) conflict with or result in any breach or violation of any
of the terms and conditions of, or constitute (or with any notice or lapse of
time or both would constitute) a default under, any order, judgment or decree
applicable to Lexicon, or any instrument, contract or other agreement to which
Lexicon is a party or by or to which it is bound or subject; or
(iii) result in the creation of any lien or other encumbrance
on the assets or properties of Lexicon.
3.12 Delivery of Periodic Reports; Compliance with 1934 Act. Lexicon
has provided the Company and Shareholders with all of its Periodic Reports filed
with the Securities and Exchange Commission since January 1, 2005. Lexicon has
filed all required Periodic Reports and is in compliance with its reporting
obligations under the Securities Exchange Act of 1934. All reports filed
pursuant to such Act are complete and correct in all material respects. All
material contracts relative to Lexicon are included in the Periodic Reports.
3.13 Full Disclosure. No representation or warranty by Lexicon in this
Agreement contains or will contain any untrue statement of a material fact or
omit or will omit to state any fact necessary to make any statement herein not
materially misleading or necessary to a complete and correct presentation of all
material aspects of the business of Lexicon.
3.14 Representations and Warranties on Closing Date. The
representations and warranties contained in this Section 3 shall be true and
complete on the Closing Date with the same force and effect as through such
representations and warranties had been made on and as of the Closing Date.
4. COVENANTS OF COMPANY AND SHAREHOLDERS
The Company and the Shareholders covenant to Lexicon as follows:
4.1 Conduct of Business. From the date hereof through the Closing Date,
the Shareholders and the Company shall cause the Company to conduct its business
in the ordinary course and, without the prior written consent of Lexicon, shall
ensure that the Company does not undertake any of the actions specified in
Section 2.11 hereof.
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4.2 Preservation of Business. From the date hereof through the Closing
Date, the Shareholders and the Company shall cause the Company to use its best
efforts to preserve its business organization intact, keep available the
services of its present employees, consultants and agents, maintain its present
suppliers and customers and preserve its goodwill.
4.3 Litigation. The Company shall promptly notify Lexicon of any
lawsuits, claims, proceedings or investigations which after the date hereof are
threatened or commenced against the Company or against any officer, director,
employee, consultant, agent, shareholder or other representative with respect to
the affairs of the Company.
4.4 Continued Effectiveness of Representations and Warranties. From the
date hereof through the Closing Date, the Shareholders and the Company shall
cause the Company to conduct its business in such a manner so that the
representations and warranties contained in Section 2 shall continue to be true
and correct on and as of the Closing Date and as if made on and as of the
Closing Date, and shall:
(i) promptly give notice to the Company or any event,
condition or circumstance occurring from the date hereof through the Closing
Date which would render any of the representations or warranties materially
untrue, incomplete, insufficient or constitute a violation or breach of this
Agreement; and
(ii) supplement the information contained herein in order that
the information contained herein is kept current, complete and accurate in all
material respects.
5 COVENANTS OF LEXICON
Lexicon covenants to the Company and the Shareholders as follows:
5.1 Conduct of Business. From the date hereof through the Closing Date,
Lexicon shall conduct its business in the ordinary course and, without the prior
written consent of the Company, shall ensure that Lexicon does not undertake any
of the actions specified in Section 3.10 hereof.
5.2 Preservation of Business. From the date hereof through the Closing
Date, Lexicon shall preserve its business organization intact and use its best
efforts to preserve Lexicon's goodwill.
5.3 Litigation. Lexicon shall promptly notify the Company of any
lawsuits, claims, proceedings or investigations which after the date hereof are
threatened or commenced against Lexicon or against any officer, director,
employee, consultant, agent, or stockholder with respect to the affairs of
Lexicon.
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5.4 Continued Effectiveness of Representations and Warranties. From the
date hereof through the Closing Date, Lexicon shall conduct its business in such
a manner so that the representations and warranties contained in Section 3 shall
continue to be true and correct on and as of the Closing Date and as if made on
and as of the Closing Date, and shall:
(i) promptly give notice to the Company of any event,
condition or circumstance occurring from the date hereof through the Closing
Date which would render any of the representations or warranties materially
untrue, incomplete, insufficient or constitute a violation or breach of this
Agreement; and
(ii) supplement the information contained herein in order that
the information contained herein is kept current, complete and accurate in all
material respects.
6. COVENANTS
6.1 Corporate Examinations and Investigations. Prior to the Closing
Date, the parties acknowledge that they have been entitled, through their
employees and representatives, to make such investigation of the assets,
properties, business and operations, books, records and financial condition of
the other as they each may reasonably require. No investigation by a party
hereto shall, however, diminish or waive in any way any of the representations,
warranties, covenants or agreements of the other party under this Agreement.
6.2 Expenses. Each party hereto agrees to pay its own costs and
expenses incurred in negotiating this Agreement and consummating the
transactions described herein. Notwithstanding the foregoing, Lexicon shall be
responsible for all of the costs and expenses incurred by the Company in
connection with the audit of the Company's financial statements for the fiscal
years ended December 31, 2004 and 2003 and for any further interim period and
for the preparation of a registration statement and other reports necessary to
make Lexicon (post-Closing) compliant with all of the rules and regulations of
the U.S. Securities and Exchange Commission.
6.3 Further Assurances. The parties shall execute such documents and
other papers and take such further actions as may be reasonably required or
desirable to carry out the provisions hereof and the transactions contemplated
hereby. Each such party shall use its best efforts to fulfill or obtain the
fulfillment of the conditions to the Closing, including, without limitation, the
execution and delivery of any documents or other papers, the execution and
delivery of which are necessary or appropriate to the Closing.
6.4 Confidentiality. In the event the transactions contemplated by this
Agreement are not consummated, each of the parties hereto agree to keep
confidential any information disclosed to each other in connection therewith for
a period of one (1) year from the date hereof; provided, however, such
obligation shall not apply to information which:
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(i) at the time of disclosure was public knowledge;
(ii) after the time of disclosure becomes public knowledge
(except due to the action of the receiving party); or
(iii) the receiving party had within its possession at the
time of disclosure.
7. CONDITIONS PRECEDENT TO THE OBLIGATION OF LEXICON TO CLOSE
The obligation of Lexicon to enter into and complete the Closing is
subject, at the option of Lexicon, to the fulfillment on or prior to the Closing
Date of the following conditions, any one or more of which may be waived by
Lexicon in writing.
7.1 Representations and Covenants. The representations and warranties
of the Company and the Shareholders contained in this Agreement shall be true in
all material respects on and as of the Closing Date with the same force and
effect as though made on and as of the Closing Date. The Company and the
Shareholders shall have performed and complied in all material respects with all
covenants and agreements required by this Agreement to be performed or complied
with by the Company and the Shareholders on or prior to the Closing Date. The
Company and the Shareholders shall have delivered to Lexicon, if requested, a
certificate, dated the Closing Date, to the foregoing effect.
7.2 Governmental Permits and Approvals; Corporate Resolutions. Any and
all permits and approvals from any governmental or regulatory body required for
the lawful consummation of the Closing shall have been obtained. The Board of
Directors or the Shareholders of the Company shall have approved the
transactions contemplated by this Agreement and the Company shall have delivered
to Lexicon, if requested by Lexicon resolutions by its Board of Directors,
certified by the Secretary of the Company authorizing the transactions
contemplated by this Agreement.
7.3 Third Party Consents. All consents, permits and approvals from
parties to any contracts, loan agreements or other agreements with the Company
which may be required in connection with the performance by the Company of its
obligations under such contracts or other agreements after the Closing shall
have been obtained.
7.4 Litigation. No action, suit or proceeding shall have been
instituted before any court or governmental or regulatory body or instituted or
threatened by any governmental or regulatory body to restrain, modify or prevent
the carrying out of the transactions contemplated hereby or to seek damages or a
discovery order in connection with such transactions, or which has or may have,
in the reasonable opinion of Lexicon, a materially adverse effect on the assets,
properties, business, operations or condition (financial or otherwise) of the
Company.
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7.5 Stock Certificates: At the Closing, the Shareholders shall have
delivered the certificates representing the Shares, duly endorsed (or with
executed stock powers) so as to make Lexicon the sole owner thereof.
7.6 Employment and Noncompetition Agreement. The Company and the
Shareholders shall have entered into two-year employment and non-competition
agreements and such other key employees of the Company and the Company shall
have entered into similar agreements. The non-competition agreements shall have
a period of two year's following the termination of the employee's employment
with the Company.
7.7 Releases. The Shareholders and other key employees designated by
Lexicon shall have executed releases that release the Company from any
obligations owed to the Shareholders and such other key employees, except for
obligations specifically referred to in such releases.
7.8 Opinion. Lexicon shall have received an opinion of counsel to the
Company and the Shareholders that is in form and substance reasonably
satisfactory to Lexicon containing opinions that are customary for transactions
of this type, including, an opinion regarding the ownership by Lexicon of the
Shares following the Closing.
7.9 Other Documents. The Company and the Shareholders shall have
delivered such other documents, instruments and certificates, if any, as are
required to be delivered pursuant to the provisions of this Agreement or which
may be reasonably requested in furtherance of the provisions of this Agreement.
8. CONDITIONS PRECEDENT TO THE OBLIGATION OF THE COMPANY AND
SHAREHOLDERS TO CLOSE
The obligation of the Company and the Shareholders to enter into and
complete the Closing is subject, at the option of the Company and the
Shareholders, to the fulfillment on or prior to the Closing Date of the
following conditions, any one or more of which may be waived in writing by the
Company.
8.1 Representations and Covenants. The representations and warranties
of Lexicon contained in this Agreement shall be true in all material respects on
the Closing Date with the same force and effect as though made on and as of the
Closing Date. Lexicon shall have performed and complied with all covenants and
agreements required by the Agreement to be performed or complied with by Lexicon
on or prior to the Closing Date. Lexicon shall have delivered to the Company and
the Shareholders, if requested, a certificate, dated the Closing Date and signed
by an executive officer of Lexicon, to the foregoing effect.
8.2 Governmental Permits and Approvals; Corporate Resolutions. Any and
all permits and approvals from any governmental or regulatory body required for
the lawful consummation of the Closing shall have been obtained. The Board of
Directors or the Shareholders of Lexicon shall have approved the transactions
contemplated by this Agreement and Lexicon shall have delivered to the Company,
if requested by the Company resolutions by its Board of Directors, certified by
the Secretary of the Company authorizing the transactions contemplated by this
Agreement.
13
8.3 Third Party Consents. All consents, permits and approvals from
parties to any contracts, loan agreements or other agreements with Lexicon which
may be required in connection with the performance by Lexicon of their
obligations under such contracts or other agreements after the Closing shall
have been obtained.
8.4 Litigation. No action, suit or proceeding shall have been
instituted before any court or governmental or regulatory body or instituted or
threatened by any governmental or regulatory body to restrain, modify or prevent
the carrying out of the transactions contemplated hereby or to seek damages or a
discovery order in connection with such transactions, or which has or may in the
reasonable opinion of the Company, have a materially adverse effect on the
assets, properties, business, operations or condition (financial or otherwise)
of Lexicon.
8.5 Stock Certificates and Cash. At the Closing, the Shareholders shall
receive certificates representing the securities to be received pursuant hereto
and the cash payment required hereby.
8.6 Employment and Noncompetition Agreement. The Company and the
Shareholders shall have entered into two-year employment and non-competition
agreements and such other key employees of the Company and the Company shall
have entered into similar agreements. The non-competition agreements shall have
a period of two year's following the termination of the employee's employment
with the Company.
8.7 Other Documents. Lexicon shall have delivered such other
instruments, documents and certificates, if any, as are required to be delivered
pursuant to the provisions of this Agreement or which may be reasonably
requested in furtherance of the provisions of this Agreement.
9. SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF LEXICON
Notwithstanding any right of the Company and the Shareholders fully to
investigate the affairs of Lexicon, the former shall have the right to rely
fully upon the representations, warranties, covenants and agreements of Lexicon
contained in this Agreement or in any document delivered by Lexicon or any of
its representatives, in connection with the transactions contemplated by this
Agreement. All such representations, warranties, covenants and agreements shall
survive the execution and delivery hereof and the Closing Date hereunder for
twelve (12) months following the Closing.
10. SURVIVAL OF REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE
SHAREHOLDERS
14
Notwithstanding any right of Lexicon fully to investigate the affairs
of the Company, Lexicon has the right to rely fully upon the representations,
warranties, covenants and agreements of the Company and the Shareholders
contained in this Agreement or in any document delivered to Lexicon by the
latter or any of their representatives in connection with the transactions
contemplated by this Agreement. All such representations, warranties, covenants
and agreements shall survive the execution and delivery hereof and the Closing
Date hereunder for twelve (12) months following the Closing.
11. INDEMNIFICATION
11.1 Obligation of Lexicon to Indemnify. Subject to the limitations on
the survival of representations and warranties contained in ▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇
hereby agrees to indemnify, defend and hold harmless the Company and the
Shareholders from and against any losses, liabilities, damages, deficiencies,
costs or expenses (including interest, penalties and reasonable attorneys' fees
and disbursements) (a "Loss") based upon, arising out of or otherwise due to any
inaccuracy in or any breach of any representation, warranty, covenant or
agreement of Lexicon contained in this Agreement or in any document or other
writing delivered pursuant to this Agreement.
11.2 Obligation of the Company and the Shareholders to Indemnify.
Subject to the limitations on the survival of representations and warranties
contained in Section 10, the Company and the Shareholders agree to indemnify,
defend and hold harmless Lexicon from and against any Loss, based upon, arising
out of or otherwise due to any inaccuracy in or any breach of any
representation, warranty, covenant or agreement made by any of them and
contained in this Agreement or in any document or other writing delivered
pursuant to this Agreement.
12. THE CLOSING
The Closing shall take place on the second business day following the
satisfaction or waiver of the conditions to closing specified herein or on such
other date as the Parties may agree. The parties expect the Closing to occur on
or before December 31, 2005. At the Closing, the parties shall provide each
other with such documents as may be necessary or appropriate in order to
consummate the transactions contemplated hereby including evidence of due
authorization of the Agreement and the transactions contemplated hereby.
13. MISCELLANEOUS
13.1 Waivers. The waiver of a breach of this Agreement or the failure
of any party hereto to exercise any right under this Agreement shall in no event
constitute waiver as to any future breach whether similar or dissimilar in
nature or as to the exercise of any further right under this Agreement.
15
13.2 Amendment. This Agreement may be amended or modified only by an
instrument of equal formality signed by Lexicon and the Company and a majority
in interest of the Shareholders of the Company or the duly authorized
representatives of the respective parties.
13.3 Assignment. This Agreement is not assignable except by operation
of law.
13.4 Notices. Until otherwise specified in writing, the mailing
addresses of the parties of this Agreement shall be as follows:
If to Lexicon, to: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ # ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
If to the Company or the
Shareholders 177 ▇▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 20040-007
Any notice or statement given under this Agreement shall be deemed to have been
given if sent by registered mail addressed to the other party at the address
indicated above or at such other address which shall have been furnished in
writing to the addressor.
13.5 Governing Law. This Agreement shall be construed, and the legal
relations be the parties determined, in accordance with the laws of the State of
New York, thereby precluding any choice of law rules which may direct the
applicable of the laws of any other jurisdiction.
13.6 Publicity. No publicity release or announcement concerning this
Agreement or the transactions contemplated hereby shall be issued by either
party hereto at any time from the signing hereof without advance approval in
writing of the form and substance thereof by the other party.
13.7 Entire Agreement. This Agreement (including the Exhibits and
Schedules hereto) contains the entire agreement among the parties with respect
to the exchange of the Shares for the Lexicon Shares and related transactions,
and supersede all prior agreements, written or oral, with respect thereto.
13.8 Headings. The headings in this Agreement are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
13.9 Severability of Provisions. The invalidity or unenforceability of
any term, phrase, clause, paragraph, restriction, covenant, agreement or other
provision of this Agreement shall in no way affect the validity or enforcement
of any other provision or any part thereof.
13.10 Counterparts; Facsimile Execution. This Agreement may be executed
in any number of counterparts, each of which when so executed, shall constitute
an original copy hereof, but all of which together shall consider but one and
the same document. Facsimile execution and delivery of this Agreement is legal,
valid and binding for all purposes.
16
13.11 Abandonment Or Deferral. At any time before the Closing, this
Agreement may be terminated and the share exchange may be abandoned by the Board
of Directors of either or both of Lexicon and the Company, notwithstanding the
approval of this Agreement by the shareholders of either of Lexicon or the
Company, or the Closing may be deferred for a reasonable period of time if, in
the opinion of the Board of Directors of Lexicon and the Company, such action
would be in the best interests of such corporations. In the event of termination
of this Agreement, this Agreement shall become void and of no effect and there
shall be no liability on the part of either Lexicon or the Company or their
respective Boards of Directors or shareholders with respect thereto.
[signature page follows]
17
[Lexicon Signature Page]
IN WITNESS WHEREOF, Lexicon has executed this Share Exchange Agreement
on the date first above written.
LEXICON UNITED INCORPORATED
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Its: Chief Executive Officer
----------------------------------
18
[Company Signature Page]
IN WITNESS WHEREOF, the Company has executed this Share Exchange
Agreement on the date first above written.
ATN CAPITAL & PARTICIPACOES LTDA.
By: /s/ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ Fraguas By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ da ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------- -------------------------------------
Name: ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ Fragua Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇ da ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------ -------------------------------------
Its: Director Its: Director
------------------------------ -------------------------------------
19
[Shareholder Signature Page]
IN WITNESS WHEREOF, the undersigned Shareholder of the Company has
executed this Share Exchange Agreement on the date first above written.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ da ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ Fraguas
--------------------------------------
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇
EXHIBIT A
EXCHANGE WITH LEXICON
------------------------------- ---------------------------- ---------------------------- ----------------------------
Name of Shareholder Number of Shares to Be Number of Lexicon Shares Amount of Cash
Exchanged to Be Received Consideration to be
Received
------------------------------- ---------------------------- ---------------------------- ----------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ 280,000 1,400,000 $75,384.40
------------------------------- ---------------------------- ---------------------------- ----------------------------
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇,▇▇▇ 600,000 $32,307.60
------------------------------- ---------------------------- ---------------------------- ----------------------------
400,000 2,000,000 $107,692.00
------------------------------- ---------------------------- ---------------------------- ----------------------------