Exhibit 2
AGREEMENT AND PLAN OF REORGANIZATION
REGENT GROUP, INC.,
ACQUISITION CORP.,
(A WHOLLY OWNED SUBSIDIARY OF REGENT GROUP, INC.)
MILLENNIUM BIOTECHNOLOGIES, INC.
AND
THE STOCKHOLDERS OF MILLENNIUM BIOTECHNOLOGIES, INC.
DATED AS OF
July 26, 2001
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.1 Definitions..........................................................1
1.2 Rules of Construction................................................1
ARTICLE II
THE MERGER
2.1 The Merger...........................................................2
2.2 Effective Time.......................................................2
2.3 Closing .............................................................2
2.4 Effects of the Merger................................................2
2.5 Certificate of Incorporation and Bylaws .............................2
2.6 Directors ...........................................................2
2.7 Officers ............................................................2
2.8 Conversion of Company Common Stock ..................................3
2.9 Exchange Procedures .................................................3
2.10 No Further Ownership Rights in Company Common Stock ................4
2.11 Stock Transfer Book..................................................4
2.12 Dissenters Rights....................................................4
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE
COMPANY AND THE COMPANY STOCKHOLDERS
3.1 Corporate Organization...............................................4
3.2 Qualification........................................................4
3.3 Authorization........................................................5
3.4 Approvals............................................................5
3.5 Absence of Conflicts.................................................5
3.6 Subsidiaries; Equity Investments.....................................6
3.7 Capitalization.......................................................6
3.8 Financial Statements.................................................6
3.9 Undisclosed Liabilities .............................................7
3.10 Tax Matters..........................................................7
3.11 Litigation...........................................................7
3.12 Compliance with Law..................................................8
3.13 Employee Benefit Plans and Policies..................................8
3.14 Labor Matters........................................................8
3.15 Insurance............................................................8
3.16 Affiliate Interests..................................................9
3.17 Hazardous Materials..................................................9
3.18 Intellectual Property................................................9
3.19 Disclosure...........................................................9
3.20 Certain Agreements..................................................10
3.21 Absence of Changes..................................................10
3.22 Contracts and Commitments...........................................10
ARTICLE IV
ADDITIONAL REPRESENTATIONS AND WARRANTIES
OF THE MILLENNIUM STOCKHOLDERS
4.1 Capital Stock.......................................................11
4.2 Authorization of Agreement..........................................11
4.3 Approvals...........................................................11
4.4 Absence of Conflicts................................................11
4.5 Investment Intent...................................................12
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF REGENT AND MERGER SUB
5.1 Corporate Organization..............................................13
5.2 Authorization.......................................................13
5.3 Approvals...........................................................13
5.4 Capitalization......................................................14
5.5 Absence of Conflicts................................................14
5.6 Authorization For Regent Stock.....................................14
5.7 SEC Documents.......................................................15
5.8 Merger Sub..........................................................15
5.9 Undisclosed Liabilities.............................................15
5.10 Certain Agreements..................................................15
5.11 Absence of Changes..................................................16
5.12 Litigation..........................................................16
5.13 Tax Matters.........................................................16
5.14 Compliance With Law.................................................17
5.15 Affiliate Interest..................................................17
5.16 Hazardous Material..................................................17
5.17 Intellectual Property...............................................17
5.18 Disclosure..........................................................18
5.19 Listing.............................................................18
5.20 Permits.............................................................18
5.21 Employee Benefit Plans..............................................18
5.22 Labor Matters.......................................................18
5.23 Insurance ..........................................................18
5.24 Qualifications.............................................19
5.25 Subsidiaries .......................................................19
5.26 Contracts and commitments...........................................19
ARTICLE VI
COVENANTS OF THE COMPANY AND ITS STOCKHOLDERS
6.1 Acquisition Proposals...............................................19
6.2 Access..............................................................20
6.3 Conduct of Business by the Company Pending the Merger...............20
6.4 Confidentiality.....................................................21
6.5 Press Releases......................................................21
6.6 Consents............................................................21
6.7. Agreement to Defend.................................................22
6.8 Intellectual Property Matters.......................................22
ARTICLE VII
COVENANTS OF REGENT
7.1 Confidentiality.....................................................22
7.2 Press Releases......................................................22
7.3 Conduct of Business by Regent Pending the Merger....................22
7.4 Consents............................................................24
7.5 Agreement to Defend.................................................24
7.6 Delivery of Certificates............................................24
7.7 Access..............................................................24
7.8 Intellectual Property Matters.......................................25
7.9 Acquisition Proposals...............................................25
7.10 Notification of Certain Matters.....................................25
ARTICLE VIII
CONDITIONS
8.1 Conditions Precedent to Obligation of Each Party to Effect
the Merger........................................................25
8.2 Additional Conditions Precedent to Obligations of Regent............26
8.3 Additional Conditions Precedent to Obligations of the Company.......26
ARTICLE IX
INDEMNIFICATION
9.1 Agreement by the Company to Indemnify...............................28
9.2 Agreement by Regent to Indemnify....................................30
9.3 Conditions of Indemnification.......................................31
9.4 Applicability.......................................................31
ARTICLE X
MISCELLANEOUS
10.1 Termination.........................................................32
10.2 Effect of Termination...............................................32
10.3 Expenses............................................................33
10.4 Restrictions on Transfer of Regent Stock............................33
10.5 Waiver and Amendment................................................33
10.6 Public Statements...................................................34
10.7 Assignment..........................................................34
10.8 Notices.............................................................34
10.9 Governing Law.......................................................35
10.10 Severability........................................................35
10.11 Counterparts........................................................35
10.12 Headings............................................................35
10.13 Entire Agreement; Third Party Beneficiaries.........................35
Schedules
---------
Schedule 2.8(b) - Certain Indebtedness of Regent
Schedule 3.1 - Corporate Organization
Schedule 3.2 - Qualification
Schedule 3.4 - Approvals
Schedule 3.5 - Absence of Conflicts
Schedule 3.6 - Subsidiaries; Equity Investments
Schedule 3.7(a) - Capitalization
Schedule 3.7(b) - Capitalization
Schedule 3.8 - Financial Statements
Schedule 3.9 - Undisclosed Liabilities
Schedule 3.10(a) - Tax Matters
Schedule 3.10(b) - Tax Matters
Schedule 3.10(c) - Tax Matters
Schedule 3.11(a) - Litigation
Schedule 3.11(b) - Litigation
Schedule 3.12 - Compliance with the Law
Schedule 3.15 - Insurance
Schedule 3.16 - Affiliate Interests
Schedule 3.17 - Hazardous Material
Schedule 3.18 - Intellectual Property
Schedule 3.20 - Certain Agreements
Schedule 3.21 - Absence of Changes
Schedule 3.22 - Contracts and Commitments
Schedule 4.1 - Capital Stock
Schedule 4.4 - Absence of Conflicts
Schedule 5.1 - Corporate Organization
Schedule 5.4(a) - Capitalization
Schedule 5.4(b) - Capitalization
Schedule 5.5 - Undisclosed Liabilities
Schedule 5.10 - Certain Agreements
Schedule 5.11 - Absence of Changes
Schedule 5.12(a) - Litigation
Schedule 5.12(b) - Litigation
Schedule 5.13(a) - Tax Matters
Schedule 5.13(b) - Tax Matters
Schedule 5.13(c) - Tax Matters
Schedule 5.14 - Compliance with the Law
Schedule 5.15 - Affiliate Interests
Schedule 5.16 - Hazardous Material
Schedule 5.17 - Intellectual Property
Schedule 5.23 - Insurance
Schedule 5.24 - Qualification
Schedule 5.25 - Subsidiaries; Equity Investments
Schedule 5.26 - Contracts and Commitments
Schedule 8.3(g) - Regent Obligations
Annex:
------
Annex A - Schedule of Defined Terms
Exhibits
--------
Exhibit 1. Certificate of Designations
Exhibit 2. Section 262 of the DGCL
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization (this "Agreement"), dated as of
the 26th day of July 2001, is among REGENT GROUP, INC., a Delaware corporation
("Regent"), ACQUISITION CORP., a Delaware corporation and a wholly owned
subsidiary of Regent ("Merger Sub"), MILLENNIUM BIOTECHNOLOGIES, INC. , a
Delaware corporation, (the "Company"), and the persons listed on the signature
pages hereof under the caption "Millennium Stockholders" (hereinafter defined as
the "Millennium Stockholders").
RECITALS:
WHEREAS, the parties to this Agreement have determined it is in their best
long-term interests to effect a business combination pursuant to which the
Company will merge with and into Merger Sub on the terms and subject to the
conditions set forth herein (the "Merger");
WHEREAS, the respective Boards of Directors of Regent, Merger Sub and the
Company have approved this Agreement and the Merger pursuant to the terms and
conditions herein set forth;
WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a tax-free reorganization within the meaning of Section 368(a)
of the Internal Revenue Code of 1986, as amended (the "Code");
WHEREAS, the parties hereto desire to set forth certain representations,
warranties and covenants made by each to the other as an inducement to the
consummation of the Merger;
NOW, THEREFORE, in consideration of the above premises and the mutual
promises set forth in this Agreement, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows.
ARTICLE I
DEFINITIONS
1.1 Definitions. Certain capitalized and other terms used in this
Agreement are defined in Annex A hereto and are used herein with the meanings
ascribed to them therein.
1.2 Rules of Construction. Unless the context otherwise requires, as used
in this Agreement, (a) a term has the meaning ascribed to it; (b) an accounting
term not otherwise defined has the meaning ascribed to it in accordance with
GAAP; (c) "or" is not exclusive; (d) "including" means "including, without
limitation;" (e) words in the singular include the plural; (f) words in the
plural include the singular; (g) words applicable to one gender shall be
construed to apply to each gender; (h) the terms "hereof," "herein," "hereby,"
"hereto" and derivative or similar words refer to this entire Agreement; (i) the
terms "Article" or "Section" shall refer to the specified Article or Section of
this Agreement; and (j) section and paragraph headings in this Agreement are for
convenience only and shall not affect the construction of this Agreement.
ARTICLE II
THE MERGER
2.1 The Merger. At the Effective Time (as hereinafter defined) and upon
the terms and subject to the conditions of this Agreement and in accordance with
the Delaware General Corporation Law (the "DGCL"), Merger Sub shall be merged
with and into the Company. Following the Merger, the Company shall continue as
the surviving corporation (the "Surviving Corporation") and the separate
corporate existence of Merger Sub shall cease.
2.2 Effective Time. As soon as practicable after the Closing, the parties
hereto will file with the Secretary of State of the State of Delaware, a
certificate of merger in such form as required by, and executed in accordance
with, the relevant provisions of the corporation law of such state. The
effective time of the filing of the certificate of merger with the Secretary of
State of the State of Delaware is the "Effective Time."
2.3 Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of Silverman, Chernis,
Shin & ▇▇▇▇▇, P.C. on July 26, 2001 if all the conditions set forth in Article
VIII hereof are satisfied or waived or at such other time and place as Regent
and the Company shall agree. The date on which the Closing occurs is herein
referred to as the "Closing Date."
2.4 Effects of the Merger. The Merger shall have the effects set forth in
the DGCL. Without limiting the generality of the foregoing, and subject thereto,
at the Effective Time, all the properties, rights, privileges, powers and
franchises of the Company and Merger Sub shall vest in the Surviving
Corporation, and all debts, liabilities and duties of the Company and Merger Sub
shall become the debts, liabilities and duties of the Surviving Corporation.
2.5 Certificate of Incorporation and Bylaws. The Certificate of
Incorporation of the Company in effect at the Effective Time shall be the
Certificate of Incorporation of the Surviving Corporation until amended in
accordance with applicable Law. The bylaws of the Company in effect at the
Effective Time shall be the bylaws of the Surviving Corporation until amended in
accordance with applicable Law.
2.6 Directors. The directors of the Company at the Effective Time shall be
the directors of the Surviving Corporation, to hold office in accordance with
the Certificate of Incorporation and bylaws of the Surviving Corporation until
their successors are duly elected or appointed and qualified or until their
earlier death, resignation or removal.
2.7 Officers. The officers of the Company at the Effective Time shall be
the officers of the Surviving Corporation, to hold office in accordance with the
Certificate of Incorporation and bylaws of the Surviving Corporation until their
successors are duly elected or appointed and qualified or until their earlier
death, resignation or removal.
2
2.8 Conversion of Company Common Stock. (a) At the Effective Time, each
outstanding share of the common stock no par value per share, of Merger Sub
shall, by virtue of the Merger and without any action on the part of Regent,
Merger Sub or the Company, be converted into one fully paid and non-assessable
share of common stock of the Surviving Corporation.
(b) At the Effective Time: (i) the Company shall pay to Regent $145,000,
which sum shall be used to pay certain indebtedness of Regent set forth on
Schedule 2.8(b); and (ii) each share of common stock, $.0001 par value per share
of the Company ("Company Common Stock") issued and outstanding immediately prior
to the Effective Time shall by virtue of the Merger and without any action on
the part of Regent, Merger Sub, the Company or any holder thereof, be converted
into and be exchangeable for the right to receive newly issued fully paid and
non-assessable voting series D preferred shares, par value $1.00 per share, of
Regent ("Preferred Shares") at a ratio (the "Exchange Ratio") of .025 Preferred
Shares for each share of Company Common Stock. A copy of the Certificate of
Designation reflecting the voting powers, designations, preference and relative,
participating, optional or other special rights of the Preferred Shares is
attached hereto as Exhibit 1.
(c) At the Effective Time, all options, warrants, convertible notes
and other rights, entitling the holder thereof to purchase or otherwise acquire
any shares of Company Common Stock as disclosed under Schedule 3.7(b)
(collectively, "Instruments") shall by virtue of the Merger and without any
action on the part of Regent, Merger Sub, the Company or the holder thereof,
entitle the holder of such instrument to purchase or otherwise acquire pursuant
to the terms of such Instrument such number of Preferred Shares as would have
been issued at the Exchange Ratio had such Instrument been converted or
exercised, as the case may be, at the Effective Time.
(d) At the Effective Time, each share of the Company Common Stock
held by the Company immediately prior to the Effective Time shall, by virtue of
the Merger and without any action on the part of Merger Sub or the Company, be
canceled, retired and cease to exist and no payment shall be made with respect
thereto.
2.9 Exchange Procedures. (a) The Surviving Corporation will act as
exchange agent in connection with the Merger.
(b) At the Closing, or as soon thereafter as practicable after the
Effective Time, the Surviving Corporation as transfer agent shall mail to each
Company Stockholder of record instructions for surrendering their certificates
representing the Company's Common Stock in exchange for receiving Regent
Preferred Shares. The Company shall make available for exchange in accordance
with this Section 2.9 certificates representing Regent Preferred Shares issuable
pursuant to Section 2.8(b). Upon surrender of the certificates formerly
representing shares of Company Common Stock owned by Millennium Stockholders
(the "Certificates"), such Millennium Stockholder shall be entitled to receive
in exchange therefor Preferred Shares representing, in the aggregate, the number
of shares and fractional shares that such holder has the
3
right to receive pursuant to Section 2.8 (after taking into account all Company
Common Stock then held by such holder).
2.10 No Further Ownership Rights in Company Common Stock. All Preferred
Shares issued upon conversion of the Preferred Shares in accordance with the
terms of this Article II shall be deemed to have been issued in full
satisfaction of all rights pertaining to the Company Common Stock.
2.11 Stock Transfer Books. The stock transfer books of the Company shall
be closed immediately upon the Effective Time and there shall be no further
registration of transfers of Company Common Stock thereafter on the records of
the Company. On or after the Effective Time, any Certificates presented to the
Surviving Corporation or Regent for any reason shall be converted into Preferred
Shares with respect to the Company Common Stock formerly represented thereby at
the Exchange Ratio.
2.12 Appraisal Rights.
This executed Agreement shall constitute each of the Millennium Stockholders'
acknowledgment to decline any appraisal rights under section 262 of DGCL. By
executing this Agreement, each Millennium Stockholder acknowledges receipt of
written notice of appraisal rights and a copy of Section 262 of DGCL at least 20
days prior to the date of executing this Agreement. Section 262 of the DGCL is
attached hereto as Exhibit 2.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
THE COMPANY
The Company hereby represents and warrants to Regent and Merger Sub as
follows:
3.1 Corporate Organization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of Delaware with all
requisite corporate power and authority to own or lease its properties and
conduct its business as now owned, leased or conducted and to execute, deliver
and perform this Agreement and each instrument, document or agreement required
hereby to be executed and delivered by it at, or prior to, the Closing. True and
complete copies of the certificate of incorporation and bylaws (or other
organizational documents) of the Company are included in Schedule 3.1. The
minute books of the Company made available to Regent are complete and accurately
reflect all action taken prior to the date of this Agreement by the Company's
board of directors and stockholders in their capacities as such.
3.2 Qualification. The Company is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction in which the
nature of the business as now conducted or the character of the property owned
or leased by it makes such qualification necessary and failure to so qualify
could have a material adverse effect on the financial condition,
4
results of operations, business or properties of the Company or the Surviving
Corporation. Schedule 3.2 sets forth a list of the jurisdictions in which the
Company is qualified to do business, if any.
3.3 Authorization. The execution and delivery by the Company of this
Agreement, the performance of its obligations pursuant to this Agreement and the
execution, delivery and performance of each instrument, document or agreement
required hereby to be executed and delivered by the Company at, or prior to, the
Closing have been duly and validly authorized by all requisite corporate action
on the part of the Company and no other corporate proceedings on the part of the
Company are necessary to authorize this Agreement or any other instrument,
document or agreement required hereby to be executed by the Company at, or prior
to, the Closing. The Board of Directors of the Company have voted to recommend
approval of the Merger to the stockholders of the Company and such determination
remains in effect. This Agreement has been, and each instrument, document or
agreement required hereby to be executed and delivered by the Company at, or
prior to, the Closing will then be, duly executed and delivered by it, and this
Agreement constitutes, and, to the extent it purports to obligate the Company,
each such instrument, document or agreement will constitute (assuming due
authorization, execution and delivery by each other party thereto), the legal,
valid and binding obligation of the Company enforceable against it in accordance
with its terms.
3.4 Approvals. Except for the applicable filings with the Secretary of
State of the State of Delaware relating to the Merger and except to the extent
set forth in Schedule 3.4, to the Company's knowledge, no filing or registration
with, and no consent, approval, authorization, permit, certificate or order of
any Court or Governmental Authority is required by any applicable Law or by any
applicable Order or any applicable rule or regulation of any Court or
Governmental Authority to permit the Company to execute, deliver, perform or
consummate the transactions contemplated by this Agreement or any instrument
required hereby to be executed and delivered by it at the Closing.
3.5 Absence of Conflicts. Except to the extent set forth in Schedule 3.5,
neither the execution and delivery by the Company of this Agreement or any
instrument, document or agreement required hereby to be executed and delivered
by it at, or prior to, the Closing, nor the performance by the Company of its
obligations under this Agreement or any such instrument, document or agreement
will (assuming receipt of all consents, approvals, authorizations, permits,
certificates and orders disclosed as requisite in Schedule 3.4) to the knowledge
of the Company (a) violate or breach the terms of or cause a default under (i)
any applicable Law, (ii) any applicable Order or any applicable rule or
regulation of any Court or Governmental Authority, (iii) any applicable permits
received from any Governmental Authority or Court, (iv) the articles of
incorporation or bylaws or other organizational documents of the Company or (v)
any contract or agreement to which the Company is a party or by which it, or any
of its properties, is bound, or (b) result in the creation or imposition of any
Lien on any of the properties or assets of the Company or the Surviving
Corporation, or (c) result in the cancellation, forfeiture, revocation,
suspension or adverse modification of any existing consent, approval,
authorization, license, permit, certificate or order of any Court or
Governmental Authority, or (d) with the passage of
5
time or the giving of notice or the taking of any action of any third party have
any of the effects set forth in clauses (a), (b) or (c) of this Section.
3.6 Subsidiaries; Equity Investments. Except as set forth in Schedule 3.6,
the Company has not controlled directly or indirectly, or had any direct or
indirect equity participation in, any Person during the five year period
preceding the date hereof.
3.7 Capitalization. Schedule 3.7(a) sets forth with respect to the
Company, its authorized and outstanding Company Common Stock. Each outstanding
share of the Company's Common Stock has been duly authorized, is validly issued,
fully paid and nonassessable and was not issued in violation of any preemptive
rights of any stockholder. Set forth in Schedule 3.7(a) are the names, social
security or I.R.S. identification numbers and addresses (as reflected in the
corporate records of the Company) of each record holder of the Company's Common
Stock, together with the number of shares held by each such Person.
(b) Except as disclosed in Schedule 3.7(b), there is not outstanding any
capital stock or other security, including, without limitation, any option,
warrant or right, entitling the holder thereof to purchase or otherwise acquire
any shares of Common Stock of the Company, and there are no contracts,
agreements, commitments or arrangements obligating the Company or the Surviving
Corporation (i) to issue, sell, pledge, dispose of or encumber any shares of, or
any options, warrants or rights of any kind to acquire, or any securities that
are convertible into or exercisable or exchangeable for, any shares of, any
class of capital stock of the Company or the Surviving Corporation or (ii) to
redeem, purchase or acquire or offer to acquire any shares of, or any
outstanding option, warrant or right to acquire, or any securities that are
convertible into or exercisable or exchangeable for, any shares of, any class of
capital stock of the Company or the Surviving Corporation.
3.8 Financial Statements. The Company has delivered to Regent true and
complete copies of the financial statements of the Company consisting of (i) a
balance sheet ("Interim Balance Sheet") of the Company as of June 30, 2001 (the
"Interim Date") and the related statement of income for the six month period
then ended (collectively with the Interim Balance Sheet, the "Company Interim
Financial Statements") and (ii) an audited balance sheet of the Company as of
December 31, 2000 (the "Company 2000 Balance Sheet") and the related audited
statements of income, changes in stockholders' equity and cash flows for the
year then ended (including the notes thereto) (collectively with the Company
2000 Balance Sheet, the "Company 2000 Financial Statements" and together with
the Company Interim Financial Statements, the "Company Financial Statements").
The Company Financial Statements present fairly the financial position of the
Company and the results of its operations and changes in financial position as
of the dates and for the periods indicated therein in conformity with GAAP. The
Company Financial Statements do not omit to state any liabilities, absolute or
contingent, required to be stated therein in accordance with GAAP. All accounts
receivable of the Company reflected in the Company Financial Statements and as
incurred since the Interim Date, represent sales made in the ordinary course of
business, are collectible (net of any reserves for doubtful accounts shown in
the Company Interim Financial Statements) in the ordinary course of business
6
and, except as set forth in Schedule 3.8, are not in dispute or subject to
counterclaim, set-off or renegotiation.
3.9 Undisclosed Liabilities. Except as and to the extent of the amounts
specifically reflected or accrued for in the Interim Balance Sheet or as set
forth in Schedule 3.9, to its knowledge the Company does not have any material
liabilities or obligations of any nature whether absolute, accrued, contingent
or otherwise, and whether due or to become due. The reserves reflected in the
Interim Balance Sheet are adequate, appropriate and reasonable in accordance
with GAAP.
3.10 Tax Matters.
(a) Except as set forth in Schedule 3.10(a) (and except for filings and
payments of assessments the failure of which to file or pay will not materially
adversely affect the Company or the Surviving Corporation) to the knowledge of
the Company: (i) all Tax Returns which are required to be filed on or before the
Closing Date by or with respect to the Company have been or will be duly and
timely filed, (ii) all items of income, gain, loss, deduction and credit or
other items required to be included in each such Tax Return have been or will be
so included and all information provided in each such Tax Return is true,
correct and complete, (iii) all Taxes which have become or will become due with
respect to the period covered by each such Tax Return have been or will be
timely paid in full, (iv) all withholding Tax requirements imposed on or with
respect to the Company have been or will be satisfied in full, and (v) no
penalty, interest or other charge is or will become due with respect to the late
filing of any such Tax Return or late payment of any such Tax.
(b) There is no claim against the Company for any Taxes, and no
assessment, deficiency or adjustment has been asserted or proposed with respect
to any Tax Return of or with respect to the Company, other than those disclosed
(and to which are attached true and complete copies of all audit or similar
reports) in Schedule 3.10(b).
(c) Except as set forth in Schedule 3.10(c), there is not in force any
extension of time with respect to the due date for the filing of any Tax Return
of or with respect to the Company, or any waiver or agreement for any extension
of time for the assessment or payment of any Tax of or with respect to the
Company.
(d) The total amounts set up as liabilities for current and deferred Taxes
in the Interim Balance Sheet are sufficient to cover the payment of all Taxes,
whether or not assessed or disputed, which are, or are hereafter found to be, or
to have been, due by or with respect to the Company up to and through the
periods covered thereby.
3.11 Litigation.
7
(a) Except as set forth in Schedule 3.11(a), there are no actions at law,
suits in equity, investigations, proceedings or claims pending or, to the
knowledge of the Company, threatened against or affecting the Company before or
by any Court or Governmental Authority.
(b) Except as contemplated by this Agreement and except to the extent set
forth in Schedule 3.11(b), the Company has performed all obligations required to
be performed by it to date and is not in default under, and to the knowledge of
the Company, no event has occurred which, with the lapse of time or action by a
third party, could result in a material default under any contract or other
agreement to which the Company is a party or by which it or any of its
properties is bound or under any applicable Order of any Court or Governmental
Authority.
3.12 Compliance with Law. Except as set forth in Schedule 3.12, to its
knowledge the Company is in material compliance with all applicable statutes and
other applicable Laws and all applicable rules and regulations of all federal,
state, foreign and local governmental agencies and authorities.
3.13 Employee Benefit Plans and Policies.
The Company does not maintain or have an obligation to contribute to, and
has at no time since the effective date of ERISA maintained or had an obligation
to contribute to, any "employee pension benefit plan" as defined in Section 3(2)
of ERISA with regard to any employee, past or present, and the Company is not
and has at no time since the effective date of the Multiemployer Pension Plan
Amendment Act of 1980 been a party to, nor during such period made any
contribution to, any "Multiemployer Plan" as defined in Section 3(37) of ERISA
with regard to any employee, past or present.
3.14 Labor Matters.
(a) The Company is not a party to any collective bargaining agreement.
(b) To its knowledge the Company is in compliance in all material respects
with all federal, state or other applicable laws respecting employment and
employment practices, terms and conditions of employment and wages and hours,
and has not and is not engaged in any unfair labor practices.
3.15 Insurance. Schedule 3.15 sets forth a list of all policies of
insurance currently in effect relating to the business or operations of the
Company. Such insurance policies are in full force and effect. The Company is
presently insured, and since the inception of operations by the Company has been
insured, against such risks as companies engaged in the same or substantially
similar business would, in accordance with good business practice, customarily
be insured. The Company has given in a timely manner to its insurers all notices
required to be given under such insurance policies with respect to all claims
and actions covered by insurance, and, except as set forth in Schedule 3.15, no
insurer has denied coverage of any such claims or actions or reserved its rights
in respect of or rejected any of such claims. The Company has not received any
notice
8
or other communication from any such insurer canceling or materially amending
any of such insurance policies, and no such cancellation is pending or
threatened. The execution of this Agreement and the consummation of the
transactions contemplated hereby will not cause such insurance policies to
lapse, terminate or be canceled and will not result in any party thereto having
the right to terminate or cancel such insurance policies.
3.16 Affiliate Interests. Except as set forth in Schedule 3.16, no
employee, officer, director or stockholder or former employee, officer, director
or stockholder of the Company has any interest in any property, tangible or
intangible, including, without limitation, patents, trade secrets, other
confidential business information, trademarks, service marks or trade names,
used in or pertaining to the business of the Company, except for the normal
rights of employees and stockholders.
3.17 Hazardous Materials.
(a) The Company to its knowledge is in compliance in all material respects
with the provisions of all federal, state and local environmental, health and
safety laws, codes and ordinances and all rules and regulations promulgated
thereunder (together "Environmental Laws"), and the Company has all necessary
government permits, licenses, certificates and approvals in relation thereto.
(b) The Company has not received any complaint, order, directive, claim,
citation or notice of, and does not know of any fact(s) which might constitute a
violation(s) of any Environmental Laws.
(c) Except in accordance with a valid governmental permit, license,
certificate or approval listed in Schedule 3.17 to the Company's knowledge,
there has been no emission, spill, release or discharge of Hazardous Material in
or at the Company's place of business, or of any toxic or hazardous substances
or wastes into or upon (i) the air; (ii) soils or any improvements located
thereon; (iii) the water (including adjacent water and underground water); or
(iv) any sewer, septic system or waste treatment, storage or disposal system for
which the Company or the Surviving Corporation could be held liable.
3.18 Intellectual Property. Except as set forth in Schedule 3.18, the
Company owns, or is licensed or otherwise has the right to use all Intellectual
Property that are necessary for the conduct of the business and operations of
the Company as currently conducted. To the knowledge of the Company, (a) the use
of the Intellectual Property by the Company does not infringe on the rights of
any Person, and (b) no Person is infringing on any right of the Company with
respect to any Intellectual Property. No claims that the Company is infringing
or otherwise adversely affecting the rights of any Person with regard to any
Intellectual Property are pending or, to the knowledge of the Company,
threatened. All of the Intellectual Property that is owned by the Company is
owned free and clear of all encumbrances and was not misappropriated from any
Person. All of the Intellectual Property that is licensed by the Company is
licensed pursuant
9
to valid and existing license agreements. The consummation of the transactions
contemplated by this Agreement will not result in the loss of any Intellectual
Property.
3.19 Disclosure. The Company has disclosed in writing, or pursuant to this
Agreement and the Schedules attached hereto, all facts material to the business,
assets, prospects and condition (financial or otherwise) of the Company. No
representation or warranty to Regent by the Company contained in this Agreement,
and no statement contained in the Schedules attached hereto, no certificate,
list or other writing furnished to Regent by the Company pursuant to the
provisions hereof or in connection with the transactions contemplated hereby,
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements herein or therein not misleading.
All statements contained in this Agreement, the Schedules attached hereto, and
any certificate, list, document or other writing delivered pursuant hereto or in
connection with the transactions contemplated hereby shall be deemed a
representation and warranty of the Company for all purposes of this Agreement.
3.20 Certain Agreements. Except as set forth in Schedule 3.20, neither the
Company nor any of its officers or directors, is a party to, or bound by, any
contract, agreement or organizational document which purports to restrict, by
virtue of a noncompetition, territorial exclusivity or other provision covering
such subject matter purportedly enforceable by a third party against the Company
or the Surviving Corporation, or any of its officers or directors, the scope of
the business or operations of the Company or the Surviving Corporation, or any
of its officers or directors, geographically or otherwise.
3.21 Absence of Changes. Except as set forth in Schedule 3.21, to the
knowledge of the Company, there has not been, since March 31, 2001, any material
adverse change with respect to the business, assets, results of operations,
prospects or condition (financial or otherwise) of the Company or the Surviving
Corporation. Except as set forth in Schedule 3.21, since March 31, 2001, the
Company has not engaged in any transaction or conduct of any kind which would be
proscribed by Section 6.3 herein subsequent to the execution and delivery of
this Agreement and up to the Closing Date.
3.22 Contracts and Commitments. Schedule 3.22 includes (i) a list of all
written and oral contracts to which the Company is a party or by which its
property is bound that involve consideration or other expenditure in excess of
$10,000 or performance over a period of more than six months or that is
otherwise material to the business or operations of the Company ("Material
Contracts"); (ii) a list of all real or personal property leases to which the
Company is a party involving consideration or other expenditure in excess of
$10,000 over the term of the lease ("Material Leases"); (iii) a list of all
guarantees of, or agreements to indemnify or be contingently liable for, the
payment or performance by any Person to which the Company is a party
("Guarantees") and (iv) a list of all contracts or other formal or informal
understandings between the Company and any of its officers, directors,
employees, agents or stockholders or their affiliates ("Related Party
Agreements"). True and complete copies of each Material Contract, Material
Lease, Guarantee and Related Party Agreement, to the extent they are in written
form, have been furnished to Regent.
10
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE MILLENIUM STOCKHOLDERS
Each Millennium Stockholder hereby, severally and not jointly, represents
and warrants to Regent that:
4.1 Capital Stock. Such Stockholder is the beneficial and record owner of
the number of shares of Company Common Stock as set forth in Schedule 3.7(a) and
owns all such shares free and clear of any Lien. Except for such shares of
Company Common Stock set forth in Schedule 3.7(a) and (b), and except as
disclosed in Schedule 4.1, such Stockholder does not own, beneficially or of
record, any capital stock or other security, including, without limitation, any
option, warrant or right entitling the holder thereof to purchase or otherwise
acquire any Company Common Stock.
4.2 Authorization of Agreement. Such Stockholder has full legal right,
power, capacity and authority to execute, deliver and perform its obligations
pursuant to this Agreement and to execute, deliver and perform its obligations
under each instrument, document or agreement required hereby to be executed and
delivered by such Stockholder at, or prior to, the Closing. The execution of
this Agreement by the Millennium Stockholders represents the consent by 100
percent of the Millennium Stockholders entitled to consent to the terms and
provisions of this Agreement and the transactions contemplated herein. This
executed Agreement shall also constitute the Millennium Stockholders' written
waiver of all applicable notice requirements. The date set forth beneath such
stockholder's signature is the actual date of execution and delivery of this
Agreement by such Stockholder to the Company and Regent. This executed Agreement
shall be filed in the minute books of the Company as evidence of such
stockholder action.
4.3 Approvals. Except for filings with the Secretary of State of Delaware
relating to the Merger, to the knowledge of such Millennium Stockholder no
filing or registration with, and no consent, approval, authorization, permit,
certificate or order of any Court or Governmental Authority is required by any
applicable Law or by any applicable Order or any applicable rule or regulation
of any Court or Governmental Authority to permit such Stockholder to execute,
deliver or perform this Agreement or any instrument required hereby to be
executed and delivered by it at the Closing.
4.4 Absence of Conflicts. Except as set forth in Schedule 4.4, neither the
execution and delivery by such Millennium Stockholder of this Agreement or any
instrument, document or agreement required hereby to be executed and delivered
by it at, or prior to, the Closing, nor the performance by such Stockholder of
its obligations under this Agreement or any such instrument will (a) violate or
breach the terms of or cause a default under (i) any applicable Law, (ii) any
applicable Order or any applicable rule or regulation of any Court or
Governmental Authority,
11
(iii) the organizational documents of such Stockholder or (iv) any contract or
agreement to which such Stockholder is a party or by which it, or any of its
properties, is bound, or (b) result in the creation or imposition of any Lien on
any of the properties or assets of such Stockholder, or (c) result in the
cancellation, forfeiture, revocation, suspension or adverse modification of any
existing consent, approval, authorization, license, permit, certificate or order
of any Court or Governmental Authority, or (d) with the passage of time or the
giving of notice or the taking of any action of any third party have any of the
effects set forth in clauses (a), (b) or (c) of this Section.
4.5 Investment Intent. Each Millennium Stockholder makes the following
representations relating to its acquisition of the Preferred Shares of Regent:
(i) the Millennium Stockholder will be acquiring the Preferred Shares pursuant
to the Merger solely for such Stockholder's account, for investment purposes
only and with no current intention or plan to distribute, sell or otherwise
dispose of any of the Preferred Shares or Regent common stock, par value
$.06-2/3 per share ("Regent Common Stock") issuable upon conversion of the
Preferred Shares in connection with any distribution; (ii) such Millennium
Stockholder is not a party to any agreement or other arrangement for the
disposition of any securities of Regent; (iii) such Millennium Stockholder is an
"accredited investor" as defined in Securities Act Rule 501(a); (iv) such
Millennium Stockholder (A) is able to bear the economic risk of an investment in
the Preferred Shares acquired pursuant to this Agreement, (B) can afford to
sustain a total loss of that investment, (C) has such knowledge and experience
in financial and business matters, and such past participation in investments,
that he or she is capable of evaluating the merits and risks of the proposed
investment in the Preferred Shares, (D) has received and reviewed the SEC
Documents, (E) has had an adequate opportunity to ask questions of and receive
answers from the officers of Regent concerning any and all matters relating to
the transactions contemplated hereby, including the background and experience of
the current officers and directors of Regent, the plans for the operation of the
business of Regent, and the business, operation and financial condition of
Regent and (F) has asked all questions of the nature described in the preceding
clause (E), and all those questions have been answered to his or her
satisfaction; (v) such Millennium Stockholder acknowledges that the securities
to be delivered to such Millennium Stockholder pursuant to the Merger and upon
conversion of the Preferred Shares have not been and will not be registered
under the Securities Act or qualified under applicable blue sky laws and
therefore may not be resold by such Millennium Stockholder without compliance
with registration requirements of the Securities Act or an exemption therefrom
and that the certificate he or she will receive shall bear a legend
substantially in the form set forth in Section 10.5 of this Agreement and stop
transfer instructions; (vi) such Millennium Stockholder, if a corporation,
partnership, trust or other entity, acknowledges that it was not formed for the
specific purpose of acquiring the securities; and (vii) without limiting any of
the foregoing, such Millennium Stockholder agrees not to dispose of any portion
of the Preferred Shares or the shares of Regent Common Stock issuable upon
conversion of the Preferred Shares unless a registration statement under the
Securities Act is in effect as to the applicable shares and the disposition is
made in accordance with that registration statement, or such deposition is made
in accordance with an exemption from the registration requirements under the
Securities Act and applicable state securities laws.
12
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF REGENT AND MERGER SUB
Regent and the Merger Sub hereby represent and warrant, jointly and
severally, to the Company and the Millennium Stockholders that:
5.1 Corporate Organization. Regent and Merger Sub each is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware with all requisite corporate power and authority to own or
lease its properties and conduct its business as now owned, leased or conducted
and to execute, deliver and perform this Agreement and each instrument, document
or agreement required hereby to be executed and delivered by it at, or prior to,
the Closing. True and complete copies of the articles of incorporation and
bylaws (or other organizational documents) of Regent and Merger Sub are included
in Schedule 5.1. The minute books of Regent and Merger Sub made available to the
Company are complete and accurately reflect all action taken prior to the date
of this Agreement by its respective board of directors and stockholders in their
capacities as such.
5.2 Authorization. The execution and delivery by Regent and Merger Sub of
this Agreement, the performance by Regent and Merger Sub of their respective
obligations pursuant to this Agreement, and the execution, delivery and
performance of each instrument required hereby to be executed and delivered at
the Closing have been duly and validly authorized by all requisite corporate
action on the part of Regent and Merger Sub as the case may be and no approval
by the Stockholders of Regent is required. This Agreement has been, and each
instrument, document or agreement required hereby to be executed and delivered
by Regent and Merger Sub at, or prior to, the Closing will then be, duly
executed and delivered, as the case may be. This Agreement constitutes, and, to
the extent it purports to obligate Regent and Merger Sub to each such
instrument, document or agreement will constitute (assuming due authorization,
execution and delivery by each other party thereto), the legal, valid and
binding obligation of Regent and Merger Sub, as the case may be, enforceable
against it in accordance with its terms.
5.3 Approvals. Except for filings with the Secretary of State of the State
of Delaware relating to the Merger, to the knowledge of Regent, no filing or
registration with, and no consent, approval, authorization, permit, certificate
or order of any Court or Government Authority is required by any applicable Law
or by any applicable Order or any applicable rule or regulation of any Court or
Governmental Authority to permit Regent or Merger Sub, as the case may be, to
execute, deliver or consummate the transactions contemplated by this Agreement
or any instrument required hereby to be executed and delivered by either of them
at or prior to the Closing.
13
5.4 Capitalization. Schedule 5.4 (a) sets forth with respect to Regent its
authorized and outstanding capital stock, which includes, without limitation,
common, preferred, options, warrants, derivatives and any other rights a Regent
stockholder has to shares of Regent common stock (collectively, the "Regent
Capital Stock"). Each outstanding share of the Regent Capital Stock has been
duly authorized, is validly issued, fully paid and nonassessable and was not
issued in violation of any preemptive rights of any stockholder or any federal
or state securities laws.
(a) Except as disclosed in Schedule 5.4 (a), there is not outstanding any
capital stock or other security, including, without limitation, any preferred
stock, option, warrant or right, entitling the holder thereof to purchase or
otherwise acquire any shares of capital stock of Regent.
(b) Except as disclosed in Schedule 5.4(b), there are no contracts,
agreements, commitments or arrangements obligating Regent (i) to issue, sell,
pledge, dispose of or encumber any shares of, or any options, warrants or rights
of any kind to acquire, or any securities that are convertible into or
exercisable or exchangeable for, any shares of, any class of capital stock of
Regent or (ii) to redeem, purchase or acquire or offer to acquire any shares of,
or any outstanding option, warrant or right to acquire, or any securities that
are convertible into or exercisable or exchangeable for, any shares of, any
class of capital stock of Regent.
5.5 Absence of Conflicts. Neither the execution and delivery by Regent or
Merger Sub, as the case may be, of this Agreement or any instrument required
hereby to be executed by it at or prior to the Closing nor the performance by
Regent or Merger Sub, as the case may be, of its obligations under this
Agreement or any such instrument will to the knowledge of Regent or Merger Sub,
as the case may be, (a) violate or breach the terms of or cause a default under
(i) any applicable Law, (ii) any applicable Order or any applicable rule or
regulation of any Court or Governmental Authority, (iii) the organizational
documents of Regent or Merger Sub or (iv) any contract or agreement to which
Regent or Merger Sub is a party or by which it or any of its property is bound,
or (b) result in the creation or imposition of any Liens on any of the
properties or assets of Regent or Merger Sub or (c) result in the cancellation,
forfeiture, revocation, suspension or adverse modification of any existing
consent, approval, authorization, license, permit certificate or order of any
Court or Governmental Authority or (d) with the passage of time or the giving of
notice or the taking of any action by any third party have any of the effects
set forth in clauses (a), (b) or (c) of this Section, except, with respect to
clauses (a), (b), (c) or (d) of this Section, where such matter would not have a
material adverse effect on the business, assets, prospects or condition
(financial or otherwise) of Regent and its subsidiaries, taken as a whole.
5.6 Authorization For Regent Stock. All of the shares of Regent Preferred
Shares issuable pursuant to the Merger are duly authorized and will, when
issued, be validly issued,
14
fully paid and nonassessable and not issued in violation of the preemptive
rights of any stockholder of Regent.
5.7 SEC Documents. Regent has filed all reports, schedules, forms,
statements and other documents required to be filed by it with the Commission
pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934
(the "SEC Documents"), and during the 12 calender months prior to the Effective
Time all such SEC Documents have been filed in a timely manner, except for any
failure to timely file a document that would not make Regent ineligible to file
certain short form registration statements. The Regent SEC Documents complied in
all material respects with the requirements of the "Securities Act" or the
"Exchange Act", as the case may be, and the rules and regulations of the
Commission promulgated thereunder applicable to the SEC Documents, and none of
the SEC Documents, at the time they were filed with the Commission, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. As of their respective dates, the financial statements of Regent
included in the SEC Documents complied as to form in all material respects with
applicable accounting requirements and the published rules and regulations of
the Commission with respect thereto. Such financial statements have been
prepared in accordance with generally accepted accounting principles,
consistently applied, during the periods involved (except (i) as may be
otherwise indicated in such financial statements or the notes thereto, or (ii)
in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial condition of Regent as of the respective dates
thereof and the results of its operations and cash flows for the respective
periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments).
Regent has not received notification from the SEC, the National
Association of Securities Dealers Inc. and/or any federal or state securities
bureaus that any investigation (informal or formal), inquiry or claim is
pending, threatened or in process against Regent and/or relating to any of
Regent's securities.
5.8 Merger Sub. Merger Sub is a corporation duly incorporated under the
laws of the State of Delaware, is validly existing and in good standing under
such laws and is a wholly-owned subsidiary of Regent. Merger Sub has no assets,
liabilities or obligations and has engaged in no business except as contemplated
by this Agreement.
5.9 Undisclosed Liabilities. Except as and to the extent of the amounts
specifically reflected or accounted for in the SEC Documents or as set forth in
Schedule 5.9, to its knowledge Regent does not have any material liabilities or
obligations of any nature, whether absolute, accrued, contingent or otherwise,
and whether due or to become due. The reserves reflected in the SEC Documents
are adequate, appropriate and reasonable in accordance with GAAP.
5.10 Certain Agreements. Except as set forth in Schedule 5.10, neither
Regent nor any of its officers or directors, is a party to, or bound by, any
contract, agreement or organizational
15
document which purports to restrict, by virtue of a noncompetition, territorial
exclusivity or other provision covering such subject matter purportedly
enforceable by a third party against Regent, or any of its officers or
directors, the scope of the business or operations of Regent, or any of its
officers or directors, geographically or otherwise.
5.11 Absence of Changes. Except as set forth in Schedule 5.11, to the
knowledge of Regent there has not been, since April 30, 2001 any material
adverse change with respect to the business, assets, results of operations,
prospects or condition (financial or otherwise) of Regent. Except as set forth
in Schedule 5.11, since April 30, 2001, Regent has not engaged in any
transaction or conduct of any kind which would be proscribed by Section 7.3
herein subsequent to the execution and delivery of this Agreement and up to the
Closing Date.
5.12 Litigation.
(a) Except as set forth in Schedule 5.12(a), there are no actions at law,
suits in equity, investigations, proceedings or claims pending or, to the
knowledge of Regent threatened against or specifically affecting Regent before
or by any Court or Governmental Authority.
(b) Except as contemplated by this Agreement and except to the extent set
forth in Schedule 5.12(b), Regent has performed all obligations required to be
performed by it to date and is not in default under, and, to the knowledge of
Regent, no event has occurred which, with the lapse of time or action by a third
party could result in a material default under any contract or other agreement
to which Regent is a party or by which it or any of its properties is bound or
under any applicable Order of any Court or Governmental Authority.
5.13 Tax Matters.
(a) Except as set forth in Schedule 5.13(a) (and except for filings and
payments of assessments the failure of which to file or pay will not materially
adversely affect Regent), to the knowledge of the Regent (i) all Tax Returns
which are required to be filed on or before the Closing Date by or with respect
to Regent have been or will be duly and timely filed, (ii) all items of income,
gain, loss, deduction and credit or other items required to be included in each
such Tax Return have been or will be so included and all information provided in
each such Tax Return is true, correct and complete, (iii) all Taxes which have
become or will become due with respect to the period covered by each such Tax
Return have been or will be timely paid in full, (iv) all withholding Tax
requirements imposed on or with respect to the Company have been or will be
satisfied in full, and (v) no penalty, interest or other charge is or will
become due with respect to the late filing of any such Tax Return or late
payment of any such Tax.
(b) There is no claim against Regent for any Taxes, and no assessment,
deficiency or adjustment has been asserted or proposed with respect to any Tax
Return of or with respect to Regent, other than those disclosed (and to which
are attached true and complete copies of all audit or similar reports) in
Schedule 5.13(b).
16
(c) Except as set forth in Schedule 5.13(c), there is not in force any
extension of time with respect to the due date for the filing of any Tax Return
of or with respect to Regent, or any waiver or agreement for any extension of
time for the assessment or payment of any Tax of or with respect to Regent. The
total amounts set up as liabilities for current and deferred Taxes in the
Interim Balance Sheet are sufficient to cover the payment of all Taxes, whether
or not assessed or disputed, which are, or are hereafter found to be, or to have
been, due by or with respect to Regent up to and through the periods covered
thereby.
5.14 Compliance with Law. Except as set forth in Schedule 5.14, to its
knowledge Regent is in compliance with all applicable statutes and other
applicable Laws and all applicable rules and regulations of all federal, state,
foreign and local governmental agencies and authorities.
5.15 Affiliate Interests. Except as set forth in Schedule 5.15, no
employee, officer or director, or former employee, officer or director, of
Regent has any interest in any property, tangible or intangible, including,
without limitation, patents, trade secrets, other confidential business
information, trademarks, service marks or trade names, used in or pertaining to
the business of Regent, except for the normal rights of employees and
stockholders.
5.16 Hazardous Materials.
(a) Regent to its knowledge is in compliance in all material respects with
the provisions of all federal, state and local environmental, health and safety
laws, codes and ordinances and all rules and regulations promulgated thereunder
(together "Environmental Laws"), and Regent has all necessary government
permits, licenses, certificates and approvals in relation thereto.
(b) Regent has not received any complaint, order, directive, claim,
citation or notice of, and does not know of any fact(s) which might constitute a
violation(s) of any Environmental Laws.
(c) Except in accordance with a valid governmental permit, license,
certificate or approval listed in Schedule 5.16 to Regent's knowledge, there has
been no emission, spill, release or discharge of Hazardous Material at Regent's
place of business or any toxic or hazardous substances or wastes into or upon
(i) the air; (ii) soils or any improvements located thereon; (iii) the water
(including adjacent water and underground water); or (iv) any sewer, septic
system or waste treatment, storage or disposal system for which Regent will be
held liable.
5.17 Intellectual Property. Except as set forth in Schedule 5.17, Regent
owns, or is licensed or otherwise has the right to use all Intellectual Property
that are necessary for the conduct of the business and operations of Regent as
currently conducted. To the knowledge of the Regent, (a) the use of the
Intellectual Property by Regent does not infringe on the rights of any Person,
and (b) no Person is infringing on any right of Regent with respect to any
Intellectual Property. No claims are pending or, to the knowledge of the Regent,
threatened that Regent is infringing or otherwise adversely affecting the rights
of any Person with regard to any Intellectual
17
Property. All of the Intellectual Property that is owned by Regent is owned free
and clear of all encumbrances and was not misappropriated from any Person. All
of the Intellectual Property that is licensed by Regent is licensed pursuant to
valid and existing license agreements. The consummation of the transactions
contemplated by this Agreement will not result in the loss of any Intellectual
Property.
5.18 Disclosure. Regent has disclosed in writing, or pursuant to this
Agreement and the Schedules attached hereto, all facts material to the business,
assets, prospects and condition (financial or otherwise) of Regent. No
representation or warranty to the Company by Regent contained in this Agreement,
and no statement contained in the Schedules attached hereto, any certificate,
list or other writing furnished to the Company by Regent pursuant to the
provisions hereof or in connection with the transactions contemplated hereby,
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements herein or therein not misleading.
All statements contained in this Agreement, the Schedules attached hereto, and
any certificate, list, document or other writing delivered pursuant hereto or in
connection with the transactions contemplated hereby shall be deemed a
representation and warranty of Regent for all purposes of this Agreement.
5.19 Listing. Regent's Common Stock is listed for quotation on the
National Association of Securities Dealers, Inc. OTC Bulletin Board (the
"Principal Market").
5.20 Permits. Regent currently has no business and does not own and is not
required to own or hold franchises, licenses, permits, consents, approvals and
authorizations of Governmental Authorities or Courts necessary for the conduct
of a business.
5.21 Employee Benefit Plans and Policies. Regent does not maintain or have
an obligation to contribute to, and has at no time since the effective date of
ERISA maintained or had an obligation to contribute to, any "employee pension
benefit plan" as defined in Section 3(2) of ERISA with regard to any employee,
past or present, and Regent is not and has at no time since the effective date
of the Multiemployer Pension Plan Amendment Act of 1980 been a party to, nor
during such period made any contribution to, any "Multiemployer Plan" as defined
in Section 3(37) of ERISA with regard to any employee, past or present.
5.22 Labor Matters.
(a) Regent is not a party to any collective bargaining agreement.
(b) To the knowledge of Regent it is in compliance in all material
respects with all federal, state or other applicable laws respecting employment
and employment practices, terms and conditions of employment and wages and
hours, and has not and is not engaged in any unfair labor practices.
5.23 Insurance. Schedule 5.23 sets forth a list of all policies of
insurance currently in effect relating to the business or operations of Regent
(true and complete copies of which have
18
been furnished to the Company). Such insurance policies are in full force and
effect. Regent is presently insured, and since the inception of operations by
Regent has been insured, against such risks as companies engaged in the same or
substantially similar business would, in accordance with good business practice,
customarily be insured. Regent has given in a timely manner to its insurers all
notices required to be given under such insurance policies with respect to all
claims and actions covered by insurance, and, except as set forth in Schedule
5.23, no insurer has denied coverage of any such claims or actions or reserved
its rights in respect of or rejected any of such claims. Regent has not received
any notice or other communication from any such insurer canceling or materially
amending any of such insurance policies, and no such cancellation is pending or
threatened. The execution of this Agreement and the consummation of the
transactions contemplated hereby will not cause such insurance policies to
lapse, terminate or be canceled and will not result in any party thereto having
the right to terminate or cancel such insurance policies.
5.24 Qualification. Regent is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the nature of
the business as now conducted or the character of the property owned or leased
by it makes such qualification necessary and failure to so qualify could have a
material adverse effect on the financial condition, results of operations,
business or properties of Regent. Schedule 5.24 sets forth a list of the
jurisdictions in which Regent is qualified to do business, if any.
5.25 Subsidiaries; Equity Investments. Except as set forth in Schedule
5.25, Regent has not controlled directly or indirectly, or had any direct or
indirect equity participation in, any Person during the five (5) year period
preceding the date hereof.
5.26 Contracts and Commitments. Schedule 5.26 includes (i) a list of all
written and oral contracts to which Regent is a party or by which its property
is bound that involve consideration or other expenditure in excess of $10,000 or
performance over a period of more than six months or that is otherwise material
to the business or operations of Regent ("Material Contracts"); (ii) a list of
all real or personal property leases to which Regent is a party involving
consideration or other expenditure in excess of $10,000 over the term of the
lease ("Material Leases"); (iii) a list of all guarantees of, or agreements to
indemnify or be contingently liable for, the payment or performance by any
Person to which Regent is a party ("Guarantees") and (iv) a list of all
contracts or other formal or informal understandings between Regent and any of
its officers, directors, employees, agents or stockholders or their affiliates
("Related Party Agreements"). True and complete copies of each written Regent
Material Contract, Material Lease, Guarantee and Related Party Agreement have
been furnished to Regent.
19
ARTICLE VI
COVENANTS OF THE COMPANY
6.1 Acquisition Proposals. Prior to the Closing Date, neither the Company,
nor any of its officers, directors, employees or agents shall agree to, solicit
or encourage inquiries or proposals with respect to, furnish any information
relating to, or participate in any negotiations or discussions concerning, any
acquisition, business combination or purchase of all or a substantial portion of
the assets of, or a substantial equity interest in, either party, other than the
transactions contemplated by this Agreement. Either party shall notify the other
promptly of any unsolicited offer.
6.2 Access. The Company shall afford Regent's officers, employees,
counsel, accountants and other authorized representatives reasonable access,
during normal business hours throughout the period prior to the Closing Date, to
all its properties, books, contracts, commitments and records and, during such
period, either party shall furnish promptly any information concerning its
business, properties and personnel as the other party may reasonably request;
provided, however, that no investigation pursuant to this section or otherwise
shall affect or be deemed to modify any representation or warranty made by a
party to this Agreement.
6.3 Conduct of Business Pending the Merger. The Company covenants and
agrees that, from the date of this Agreement until the Closing Date, unless
Regent shall otherwise agree in writing or as otherwise expressly contemplated
by this Agreement:
(a) The business of the Company shall be conducted only in, and a party
shall not take any action except in, the ordinary course of business and
consistent with past practice.
(b) The Company agrees to not directly or indirectly do any of the
following: (i) issue, sell, pledge, dispose of or encumber, (A) any capital
stock (or securities convertible into capital stock) or (B) any assets (other
than in the ordinary course of business and consistent with past practice and
not relating to the borrowing of money); (ii) amend or propose to amend the
articles of incorporation or bylaws (or other organizational documents); (iii)
split, combine or reclassify any outstanding capital stock, or declare, set
aside or pay any dividend payable in stock, property or otherwise with respect
to the capital stock whether now or hereafter outstanding; (iv) redeem, purchase
or acquire or offer to acquire any of its capital stock; (v) create, incur,
assume, guarantee or otherwise become liable or obligated with respect to any
indebtedness for borrowed money other than the ordinary course of business or
(vi) except in the ordinary course of business and consistent with past
practice, enter into any contract, agreement, commitment or arrangement with
respect to any of the matters set forth in this Section 6.3(b);
(c) The Company shall use its best efforts (i) to preserve intact its
business organization, (ii) to perform or cause to be performed all of its
obligations in or under any of such leases,
20
agreements and contracts, (iii) to keep available the services of its current
officers and key employees, (iv) to preserve the goodwill of those having
business relationships with it, (v) to maintain and keep its properties in as
good a repair and condition as presently exist, except for deterioration due to
ordinary wear and tear, (vi) to maintain in full force and effect insurance
comparable in amount and scope of coverage to that currently maintained by it,
(vii) to collect its accounts receivable, (viii) to preserve in full force and
effect all leases, operating agreements, easements, rights-of-way, permits,
licenses, contracts and other agreements which relate to its assets (other than
those expiring by their terms which are not renewable);
(d) The Company shall perform its obligations under any contracts and
agreements to which it is a party or to which its assets are subject, except for
such obligations as the Company in good faith may dispute;
(e) The Company shall not take any action that would, or that reasonably
could be expected to, result in any of the representations and warranties set
forth in this Agreement becoming untrue or any of the conditions to the Merger
set forth in Article VIII not being satisfied;
(g) The Company shall not (i) amend or terminate any Plan except as may be
required by applicable Law, (ii) increase or accelerate the payment or vesting
of the amounts payable under any Plan, or (iii) adopt or enter into any
personnel policy, stock option plan, collective bargaining agreement, bonus plan
or arrangement, incentive award plan or arrangement, vacation policy, severance
pay plan, policy or agreement, deferred compensation agreement or arrangement,
executive compensation or supplemental income arrangement, consulting agreement,
employment agreement or any other employee benefit plan, agreement, arrangement,
program, practice or understanding (other than the Plans); and
(h) The Company shall not enter into any agreement or incur any
obligation, the terms of which would be violated by the consummation of the
transactions contemplated by this Agreement.
6.4 Confidentiality. The Company shall cause its officers, directors,
employees, representatives and consultants to hold in confidence, and not
disclose to any Person for any reason whatsoever, any non-public information
received by them or their representatives in connection with the transactions
contemplated hereby, including, but not limited to, all terms, conditions and
agreements related to this transaction and all concepts (including multiples and
methodology) used in negotiation of the Purchase Price (as hereinafter defined),
except (i) as required by Law; (ii) for disclosure to officers, directors,
employees and representatives of the Company or Regent as necessary in
connection with the transactions contemplated hereby; and (iii) for information
which becomes publicly available other than through the actions of a party to
this Agreement. In the event the Merger is not consummated, the Company will
return all non-public documents and other material obtained from Regent or its
representatives in connection with the transactions contemplated hereby or
certify to Regent that all such information has been destroyed.
21
6.5 Press Releases. Any pubic announcements or press releases to be issued
by the Company with respect to the transactions contemplated hereunder shall
require Regent's prior written consent, which consent shall not be unreasonably
withheld.
6.6 Consents. Subject to the terms and conditions of this Agreement, the
Company shall (i) obtain all consents, waivers, approvals authorizations and
orders required in connection with the authorization, execution and delivery of
this Agreement and the consummation of the Merger; and (ii) take, or cause to be
taken, all appropriate action, and do, or cause to be done, all things necessary
or proper to consummate and make effective as promptly as practicable the
transactions contemplated by this Agreement.
22
6.7 Agreement to Defend. In the event any claim, action, suit,
investigation or other proceeding by any Governmental Authority or other Person
or other legal or administrative proceeding is commenced that questions the
validity or legality of the transactions contemplated hereby or seeks damages in
connection therewith, whether before or after the Effective Time, the Company
shall cooperate and use reasonable efforts to defend against and respond
thereto.
6.8 Intellectual Property Matters. The Company shall use its best efforts
to preserve its ownership rights to the Intellectual Property free and clear of
any Liens and shall use its best efforts to assert, contest and prosecute any
infringement of any issued foreign or domestic patent, trademark, service ▇▇▇▇,
trade name or copyright that forms a part of the Intellectual Property or any
misappropriation or disclosure of any trade secret, confidential information or
know-how that forms a part of the Intellectual Property.
ARTICLE VII
COVENANTS OF REGENT
7.1 Confidentiality. Regent agrees, and Regent agrees to cause its
officers, directors, employees, representatives and consultants, to hold in
confidence all, and not to disclose to any Person for any reason whatsoever, any
non-public information received by it or its representatives in connection with
the transactions contemplated hereby except (i) as required by Law; (ii) for
disclosure to officers, directors, employees and representatives of Regent as
necessary in connection with the transactions contemplated hereby or as
necessary to the operation of Regent's business; and (iii) for information which
becomes publicly available other than through the actions of Regent. In the
event the Merger is not consummated, Regent will return all non-public documents
and other material obtained from the Company or its representatives in
connection with the transactions contemplated hereby or certify to the Company
that all such information has been destroyed.
7.2 Press Releases. Any pubic announcements or press releases to be issued
by Regent with respect to the transactions contemplated hereunder shall require
the Company's prior written consent, which consent shall not be unreasonably
withheld.
7.3 Conduct of Business by Regent Pending the Merger. Regent covenants and
agrees that, from the date of this Agreement until the Closing Date, unless the
Company shall otherwise agree in writing or as otherwise expressly contemplated
by this Agreement:
(a) The business of Regent shall be conducted only in, and Regent shall
not take any action except in, the ordinary course of business and consistent
with past practice.
(b) Regent shall not directly or indirectly do any of the following: (i)
issue, sell, pledge, dispose of or encumber, (A) any capital stock (or
securities convertible into capital
23
stock) of Regent or (B) any assets of Regent (other than in the ordinary course
of business and consistent with past practice and not relating to the borrowing
of money); (ii) amend or propose to amend the articles of incorporation or
bylaws (or other organizational documents) of the Company; (iii) split, combine
or reclassify any outstanding capital stock of the Company, or declare, set
aside or pay any dividend payable in stock, property or otherwise with respect
to its capital stock whether now or hereafter outstanding; (iv) redeem, purchase
or acquire or offer to acquire any of its capital stock; (v) create, incur,
assume, guarantee or otherwise become liable or obligated with respect to any
indebtedness for borrowed money except in the ordinary course of business or
(vi) except in the ordinary course of business and consistent with past
practice, enter into any contract, agreement, commitment or arrangement with
respect to any of the matters set forth in this Section 7.3(b);
(c) Regent shall use its best efforts (i) to preserve intact the business
organization of the Company, (ii) to perform or cause to be performed all of its
obligations in or under any of such leases, agreements and contracts, (iii) to
keep available the services of its current officers and key employees, (iv) to
preserve the goodwill of those having business relationships with it, (v) to
maintain and keep its properties in as good a repair and condition as presently
exists, except for deterioration due to ordinary wear and tear, (vi) to maintain
in full force and effect insurance comparable in amount and scope of coverage to
that currently maintained by it, (vii) to collect its accounts receivable,
(viii) to preserve in full force and effect all leases, operating agreements,
easements, rights-of-way, permits, licenses, contracts and other agreements
which relate to its assets (other than those expiring by their terms which are
not renewable);
(d) Regent shall not make or agree to make any single capital expenditure
or enter into any purchase commitments in excess of $10,000;
(e) Regent shall perform its obligations under any contracts and
agreements to which it is a party or to which its assets are subject, except for
such obligations as the Regent in good faith may dispute;
(f) Regent shall not increase the salary, benefits, stock options, bonus
or other compensation of any officer, director or employee of Regent other than
in the ordinary course of business and consistent with past practice, and shall
not grant, to any individual, severance or termination pay that exceeds the
lesser of (i) such individual's compensation for the calendar month immediately
preceding such individual's grant of severance or termination pay, or (ii)
$10,000;
(g) Regent shall not take any action that would, or that reasonably could
be expected to, result in any of the representations and warranties set forth in
this Agreement becoming untrue or any of the conditions to the Merger set forth
in Article VIII not being satisfied;
(h) Regent shall not (i) amend or terminate any Plan except as may be
required by applicable Law, (ii) increase or accelerate the payment or vesting
of the amounts payable under
24
any Plan or (iii) adopt or enter into any personnel policy, stock option plan,
collective bargaining agreement, bonus plan or arrangement, incentive award plan
or arrangement, vacation policy, severance pay plan, policy or agreement,
deferred compensation agreement or arrangement, executive compensation or
supplemental income arrangement, consulting agreement, employment agreement or
any other employee benefit plan, agreement, arrangement, program, practice or
understanding (other than the Plans);
(i) Regent shall not enter into any agreement or incur any obligation, the
terms of which would be violated by the consummation of the transactions
contemplated by this Agreement; and
(j) Regent shall maintain the listing of its Common Stock on the Principal
Market. Regent shall not take any action which would be reasonably expected to
result in the delisting or suspension of its securities on the Principal Market
(excluding suspensions of not more than one trading day resulting from business
announcements by Regent). Regent shall promptly provide to the Company copies of
any notices it receives from the Principal Market regarding the continued
eligibility of its Securities for listing on the Principal Market.
7.4 Consents. Subject to the terms and conditions of this Agreement,
Regent shall (i) obtain all consents, waivers, approvals, authorizations and
orders required in connection with the authorization, execution and delivery of
this Agreement and the consummation of the Merger; and (ii) take, or cause to be
taken, all appropriate action, and do, or cause to be done, all things
necessary, proper or advisable to consummate and make effective as promptly as
practicable the transactions contemplated by this Agreement.
7.5 Agreement to Defend. In the event any claim, action, suit,
investigation or other proceeding by any Governmental Authority or other Person
or other legal or administrative proceeding is commenced that questions the
validity or legality of the transactions contemplated hereby or seeks damages in
connection therewith, whether before or after the Effective Time, Regent agrees
to cooperate and use reasonable efforts to defend against and respond thereto.
7.6 Delivery of Certificates. As soon as practicable after the Closing
Date, Regent will deliver to each holder of certificates which represents the
Company's Common Stock prior to the Effective Time the stock certificates
contemplated by Article II of this Agreement.
7.7 Access. Regent shall afford the Company's officers, employees,
counsel, accountants and other authorized representatives reasonable access,
during normal business hours throughout the period prior to the Closing Date, to
all its properties, books, contracts, commitments and records and, during such
period, Regent shall furnish promptly to the Company any information concerning
its business, properties and personnel as the Company may reasonably request;
25
provided, however, that no investigation pursuant to this Section or otherwise
shall affect or be deemed to modify any representation or warranty made by
Regent pursuant to this Agreement.
7.8 Intellectual Property Matters. Regent shall use its best efforts to
preserve its ownership rights to the Intellectual Property free and clear of any
Liens and shall use its best efforts to assert, contest and prosecute any
infringement of any issued foreign or domestic patent, trademark, service ▇▇▇▇,
trade name or copyright that forms a part of the Intellectual Property or any
misappropriation or disclosure of any trade secret, confidential information or
know-how that forms a part of the Intellectual Property.
7.9 Acquisition Proposals. Prior to the Closing Date, neither Regent, nor
any of its officers, directors, employees or agents nor any party to this
Agreement shall agree to, solicit or encourage inquiries or proposals with
respect to, furnish any information relating to, or participate in any
negotiations or discussions concerning, any acquisition, business combination or
purchase of all or a substantial portion of the assets of, or a substantial
equity interest in, Regent or Merger Sub, other than the transactions
contemplated by this Agreement. Regent or Merger Sub shall notify the Company of
any unsolicited offer.
7.10 Notification of Certain Matters. Regent shall give prompt notice to
the Company, orally and in accordance with Section 10.8 hereof, of: (i) the
occurrence, or failure to occur, of any event which occurrence or failure would
be likely to cause any representation or warranty contained in this Agreement to
be untrue or inaccurate at any time from the date hereof to the Effective Time,
(ii) any failure of Regent, or any of its officer, director, employee or agent
thereof, or any party to this Agreement to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by it hereunder, or
(iii) any litigation, or any claim or controversy or contingent liability of
which Regent has knowledge of that might reasonably be expected to become the
subject of litigation, against Regent or affecting any of its assets, in each
case in an amount in controversy in excess of $10,000, or that is seeking to
prohibit or restrict the transactions contemplated hereby.
ARTICLE VIII
CONDITIONS
8.1 Conditions Precedent to Obligation of Each Party to Effect the Merger.
The respective obligations of each party to effect the Merger shall be subject
to the fulfillment at or prior to the Closing Date of the following conditions:
(a) No Order shall have been entered and remain in effect in any action or
proceeding before any Court or Governmental Authority that would prevent or make
illegal the consummation of the Merger;
26
(b) There shall have been obtained any and all permits, approvals and
consents of securities or "blue sky" commissions of each jurisdiction and of any
other Governmental Authority that reasonably may be deemed to be necessary so
that the consummation of the Merger and the transactions contemplated thereby
will be in material compliance with all applicable Laws;
(c) Receipt of all applicable material third party approval of the Merger
and the transactions contemplated thereby;
(d) No pending or threatened material litigation concerning: (i) Regent or
the Company; (ii) the acquisition of their securities; or (iii) their continued
operation after Closing, which would materially adversely affect their business;
and
(e) There shall have occurred no adverse event, including fire or other
casualty, which materially affects Regent or the Company.
8.2 Additional Conditions Precedent to Obligations of Regent. The
obligation of Regent to effect the Merger is also subject to the fulfillment at
or prior to the Closing Date of the following conditions:
(a) The representations and warranties of the Company contained in this
Agreement shall be true and correct in all material respects as of the date when
made and in all material respects as of the Closing Date as though such
representations and warranties had been made at and as of the Closing Date; all
of the terms, covenants and conditions of this Agreement to be complied with and
performed by the Company on or before the Closing Date shall have been duly
complied with and performed in all material respects, and a certificate to the
foregoing effect dated the Closing Date and signed by the Chief Executive
Officer of the Company shall have been delivered to Regent, and a copy of the
resolutions of the Company's Board of Directors, certified by the Secretary of
the Company as of the Closing Date, approving the terms of this Agreement and
all transactions contemplated hereby shall have been delivered to Regent;
(b) Regent shall have accepted and approved the completed Schedules and
shall have been satisfied, in its sole discretion, with the results of its
legal, financial, accounting and business due diligence;
(c) Since the date of this Agreement, no material adverse change in the
business, condition (financial or otherwise), assets, operations or prospects of
the Company and its subsidiaries, taken as a whole, shall have occurred, and the
Company shall not have suffered any damage, destruction or loss (whether or not
covered by insurance) materially adversely affecting the properties or business
of the Company and its subsidiaries, taken as a whole, and Regent shall have
received a certificate signed by the Chief Executive Officer of the Company
dated the Closing Date to such effect;
27
(d) Regent shall cause its wholly owned subsidiary known as Merger Sub to
merge into the Company.
8.3 Additional Conditions Precedent to Obligations of the Company. The
obligation of the Company to effect the Merger is also subject to the
fulfillment at or prior to the Closing Date of the following conditions:
(a) The representations and warranties of Regent contained in this
Agreement shall be true and correct in all respects as of the date when made and
in all material respects as of the Closing Date as though such representations
and warranties had been made at and as of the Closing Date, all the terms,
covenants and conditions of this Agreement to be complied with and performed by
Regent on or before the Closing Date shall have been duly complied with and
performed in all material respects; and a certificate to the foregoing effect
dated the Closing Date and signed by a senior corporate officer of Regent shall
have been delivered to the Company and a copy of the resolutions of Regent's
Board of Directors, certified by its Secretary as of the Closing date, approving
the terms of this Agreement and all transactions contemplated hereby shall be
delivered to the Company;
(b) The Company shall have accepted and approved the completed Schedules
and shall have been satisfied, in its sole discretion, with the results of its
legal, financial, accounting and business due diligence;
(c) Since the date of this Agreement, no material adverse change in the
business, condition (financial or otherwise), assets, operations or prospects of
Regent and its subsidiaries, taken as a whole, shall have occurred, and Regent
shall not have suffered any damage, destruction or loss (whether or not covered
by insurance) materially adversely affecting the properties or business of
Regent and its subsidiaries, taken as a whole, and the Company shall have
received a certificate signed by the Chief Executive Officer of Regent dated the
Closing Date to such effect;
(d) Regent shall be listed on the Principal Market and shall not have
received any notice of delisting as of the Closing Date;
(e) Regent has organized Merger Sub, as a Delaware corporation, which is
organized in a manner that will permit it to merge with and into the Company
pursuant to the terms of this Agreement.
(f) At Closing, Regent shall have no more than 6,000,000 shares of common
stock issued and outstanding on a fully-diluted basis, excluding shares of
common stock issuable: (i) upon conversion of the issued and outstanding shares
of Regent's Series B and Series C Preferred stock; and (ii) upon exercise of
Regent's issued and outstanding warrants to purchase an aggregate of 825,000
shares of common stock at exercise prices ranging from $.06-2/3 to $1.10 per
share, all as set forth on Schedule 5.4(a) and (b);
28
(g) At Closing, with the exception of the obligations identified in
Schedule 8.3(g), Regent will have no material liability except up to $203,500 in
trade payables, which shall remain liabilities of Regent after the Closing. Said
payables shall be due and payable no later than a date five months after the
Closing and, if not paid by such date, shall bear interest at the rate of 25
percent per annum thereafter;
(h) The execution and delivery by Regent and Merger Sub of this Agreement,
the performance by Regent and Merger Sub of their respective obligations
pursuant to this
Agreement, and the execution, delivery and performance of each instrument
required hereby to be executed and delivered by Regent or Merger Sub at the
Closing have been duly and validly authorized by all requisite corporate action
on the part of Regent or Merger Sub, as the case may be and no approval by the
stockholders of Regent or Merger Sub is required or dissenters or appraisal
rights are triggered pursuant to DGCL Section 262.
(i) All of the officers and Directors of Regent shall submit to the
Surviving Corporation a letter of resignation on the Closing Date, except that
▇▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ will remain directors and shall be
replaced by the following officers and directors of the Company:
Names Titles
----- ------
▇▇▇▇▇ ▇▇▇▇ President, Chief Executive Officer
and a Director
▇▇▇▇▇ Deichel Chief Operating Officer, Secretary
and a Director
The foregoing shall be effected by unanimous consent of Regent's Board of
Directors. 10 days following the mailing and filing by Regent of an Information
Statement pursuant to Rule 14f-1 promulgated under the Exchange Act, Messrs Long
and ▇▇▇▇▇▇▇▇▇ shall resign and the remaining directors shall appoint one or two
additional directors as will be set forth in the above-mentioned Information
Statement.
29
ARTICLE IX
INDEMNIFICATION
9.1 Agreement by the Company to Indemnify. The Company agrees to
indemnify, defend and hold Regent harmless (subject to the limitations set forth
in Section 9.1(d) below) from and against the aggregate of all Company
Indemnifiable Damages (as defined below).
(a) For purposes of this Agreement, "Company Indemnifiable Damages" means,
the aggregate of all actual expenses, losses, costs, deficiencies, liabilities
and damages (including, without limitation, related counsel and paralegal fees
and expenses) incurred or suffered by Regent, resulting from (i) any untruth or
inaccuracy in or any breach of, a representation or warranty made by the Company
as defined in this Agreement in or pursuant to this Agreement, (ii) resulting
from any breach of the covenants or agreements made by the Company in or
pursuant to this Agreement, (iii) any inaccuracy in any certificate delivered by
the Company pursuant to this Agreement, or (iv) any claim which involves,
affects or relates to any assets, properties or operations of the Company or the
conduct of the business, of the Company prior to the Closing Date.
(b) Each of the representations and warranties made by the Company
pursuant hereto shall survive for a period of one (1) year after the Closing
Date, except (i) that the representations and warranties contained in Sections
3.10, and 3.17 shall survive until all applicable statutes of limitations have
expired and (ii) the representations and warranties contained in Sections 3.1,
3.2, 3.3, 3.7, 4.1 and 4.2 shall not expire, but shall continue indefinitely. No
claim for the recovery of the Company Indemnifiable Damages may be asserted by
Regent against the Company after such representations and warranties have
expired, provided, however, that claims for the Company Indemnifiable Damages
first asserted within the applicable period shall not thereafter be barred.
Notwithstanding any knowledge of facts determined or determinable by any party
by investigation, each party shall have the right to fully rely on the
representations, warranties, covenants and agreements of the other parties
contained in this Agreement or in any other documents or papers delivered in
connection herewith. Each representation, warranty, covenant and agreement of
the parties contained in this Agreement is independent of each other
representation, warranty, covenant and agreement;
(c) If Regent believes it is entitled to a claim for any Company
Indemnifiable Damages hereunder, Regent shall promptly give written notice to
the Company pursuant to Section 10.8 of this Agreement of such claim, the amount
or the estimated amount of such claim and the basis for such claim. If the
Company does not pay the amount of the claim for the Company Indemnifiable
Damages to Regent within ten (10) days, then Regent may exercise its respective
rights under Section 9.1 and 9.3 and/or take any action or exercise any remedy
available to it by appropriate legal proceedings to collect the Company
Indemnifiable Damages.
(d) Notwithstanding anything to the contrary contained in this Section
9.1, the Company's liability for the Company Indemnifiable Damages shall be
limited as follows:
30
(i) Regent shall have no claim for the Company Indemnifiable Damages
unless and until all Company Indemnifiable Damages incurred by Regent exceed an
aggregate of $25,000 (the "Basket Amount"), in which event the Company shall be
liable for all such Company Indemnifiable Damages.
(ii) The total amount of Company Indemnifiable Damages for which the
Company shall be liable to Regent shall not exceed the "Purchase Price", which
consists of : (i) $145,000 and (ii) the Company's common stock exchanged in
connection with this Agreement valued at the fair market value on the date of
Closing.
(iii) Each Millennium Stockholder shall have no liability pursuant
to this agreement in the absence of fraud on the part of that Stockholder.
31
9.2 Agreement by Regent to Indemnify. Regent agrees to indemnify, defend
and hold the Company harmless from and against the aggregate of all Regent
Indemnifiable Damages (as defined below).
(a) For purposes of this Agreement, "Regent Indemnifiable Damages" means,
the aggregate of all actual expenses, losses, costs, deficiencies, liabilities
and damages (including, without limitation, related counsel and paralegal fees
and expenses) incurred or suffered by the Company, resulting from (i) any
untruth or inaccuracy in or any breach of, a representation or warranty made by
Regent as defined in this Agreement in or pursuant to this Agreement, (ii)
resulting from any breach of the covenants or agreements made by Regent in or
pursuant to this Agreement, (iii) any inaccuracy in any certificate delivered by
Regent pursuant to this Agreement, or (iv) any claim which involves, affects or
relates to any assets, properties or operations of Regent or the conduct of the
business, of Regent prior to the Closing Date.
(b) Each of the representations and warranties made by Regent in this
Agreement or pursuant hereto shall survive for a period of one (1) year after
the Closing Date except (i) that the representations and warranties contained in
Sections 5.13 and 5.16 survive until all applicable statutes of limitations have
expired, and (ii) the representations and warranties contained in sections 5.1,
5.2, 5.4, and 5.25 shall not expire, but shall continue indefinitely. No claim
for the recovery of Regent Indemnifiable Damages may be asserted by the Company
against Regent after such representations and warranties have expired, provided,
however, that claims for Regent Indemnifiable Damages first asserted within the
applicable period shall not thereafter be barred. Notwithstanding any knowledge
of facts determined or determinable by any party by investigation, each party
shall have the right to fully rely on the representations, warranties, covenants
and agreements of the other parties contained in this Agreement or in any other
documents or papers delivered in connection herewith. Each representation,
warranty, covenant and agreement of the parties contained in this Agreement is
independent of each other representation, warranty, covenant and agreement;
(c) In the event that the Company believes it is entitled to a claim for
any Regent Indemnifiable Damages hereunder, the Company shall promptly give
written notice to Regent pursuant to Section 10.8 of this Agreement of such
claim and the amount or the estimated amount of such claim, and the basis for
such claim. If Regent does not pay the amount of the claim for the Regent
Indemnifiable Damages within ten (10) days, then the Company may exercise its
rights under Section 9.2 and 9.3 and/or take any action or exercise any remedy
available to it by appropriate legal proceedings to collect the Indemnifiable
Damages;
(d) Notwithstanding anything to the contrary contained in this Section 9.
2, Regent's liability for the Regent Indemnifiable Damages shall be limited as
follows:
(i) The Company shall have no claim for the Regent Indemnifiable
Damages unless and until all Regent Indemnifiable Damages incurred by the
Company exceed an aggregate of the Basket Amount of $25,000, in which event
Regent shall be liable for all Regent Indemnifiable Damages;
32
(ii) The total amount of Regent Indemnifiable Damages for which
Regent shall be liable shall not exceed the value of the Purchase Price based on
the closing bid price of the common stock underlying the Preferred Shares on the
date of issuance of said Preferred Shares; and
(iii) The Regent stockholders individually shall not have any
liability pursuant to this agreement in the absence of fraud.
9.3 Conditions of Indemnification. The obligations and liabilities of the
Company and Regent hereunder with respect to their respective indemnities
pursuant to this Article IX resulting from any claim or other assertion of
liabilities by third parties (hereinafter called collectively "Claims"), shall
be subject to the following terms and conditions:
(a) the party seeking indemnification (the "Indemnified Party") must give
the other party or parties, as the case may be (the "Indemnifying Party"),
notice of any such Claim within ten (10) business days after the Indemnified
Party receives notice thereof (provided that failure to give notice within such
ten (10) day period does not relieve the Indemnifying Party of his obligations
to indemnify the Indemnified Party hereunder, except to the extent that such
Indemnifying Party is harmed by the failure of the Indemnified Party to provide
timely notice);
(b) the Indemnifying Party shall have the right to undertake, by counsel
or other representatives of its own choosing, the defense of such Claim;
(c) if the Indemnifying Party shall elect not to undertake such defense,
or within a reasonable time after notice of any such Claim from the Indemnified
Party shall fail to defend, the Indemnified Party (upon further written notice
to the Indemnifying Party) shall have the right to undertake the defense,
compromise or settlement of such Claim, by counsel or other representatives of
its own choosing, on behalf of and for the account and risk of the Indemnifying
Party (subject to the right of the Indemnifying Party to assume defense of such
Claim at any time prior to settlement, compromise or final determination
thereof); and
(d) anything in this Section 9.3 to the contrary notwithstanding, (A) the
Indemnified Party shall have the right, at its own cost and expense, to have its
own counsel to protect its own interests and participate in the defense,
compromise or settlement of the Claim, (B) the Indemnifying Party shall not,
without the Indemnified Party's written consent, settle or compromise any Claim
or consent to entry of any judgement which does not include as an unconditional
term thereof the giving by the claimant or the plaintiff to the Indemnified
Party of a release from all liability in respect of such Claim, and (C) the
Indemnified Party, by counsel or other representatives of its own choosing and
at its sole cost and expense, shall have the right to consult with the
Indemnifying Party and its counsel or other representatives concerning such
Claim, and the Indemnifying Party and the Indemnified Party and their respective
counsel shall cooperate with respect to such Claim.
9.4 Applicability. THE PROVISIONS OF THIS ARTICLE IX SHALL APPLY
NOTWITHSTANDING THE SOLE, JOINT OR CONCURRENT NEGLIGENCE, STRICT
33
LIABILITY OR OTHER FAULT OF THE INDEMNIFIED PARTY. IF BOTH THE INDEMNIFIED PARTY
AND THE INDEMNIFYING PARTY ARE NEGLIGENT OR OTHERWISE AT FAULT OR STRICTLY
LIABLE WITHOUT FAULT, THE CONTRACTUAL OBLIGATIONS OF INDEMNIFICATION UNDER THIS
ARTICLE IX SHALL CONTINUE, BUT THE INDEMNIFYING PARTY SHALL INDEMNIFY THE
INDEMNIFIED PARTY ONLY FOR THE PERCENTAGE OF RESPONSIBILITY FOR THE DAMAGE OR
INJURIES ATTRIBUTABLE TO THE INDEMNIFYING PARTY.
ARTICLE X
MISCELLANEOUS
10.1 Termination. This Agreement may be terminated and the Merger and the
other transactions contemplated herein may be abandoned at any time prior to the
Closing:
(a) by mutual consent of Regent and the Company;
(b) by either Regent or the Company if the Merger has not been effected on
or before August 30, 2001;
(c) by either Regent or the Company if a final, unappealable order to
restrain, enjoin or otherwise prevent, or awarding substantial damages in
connection with, a consummation of the Merger or the other transactions
contemplated hereby shall have been entered;
(d) by Regent if (i) since the date of this Agreement there has been a
material adverse change in the business operations or financial condition of the
Company or (ii) there has been a material breach of any representation,
warranty, covenant or other agreement set forth in this Agreement by the
Company, which breach has not been cured within ten (10) Business Days following
receipt by the Company of notice of such breach (unless such breach cannot be
cured within such time, reasonable efforts have begun to cure such breach prior
to the tenth (10th) Business Day and such breach is then cured within thirty
(30) days after notice);
(e) by the Company: (i) if since the date hereof there has been a material
adverse change in the business operations or financial condition of Regent; or
(ii) if there has been a material breach of any representation, warranty,
covenant or other agreement set forth in this Agreement by Regent, which breach
has not been cured within ten (10) Business Days following receipt by Regent of
notice of such breach (unless such breach cannot be cured within such time,
reasonable efforts have begun to cure such breach prior to the tenth (10th)
Business Day and such breach is then cured within thirty (30) Business Days
after notice).
10.2 Effect of Termination. In the event of any termination of this
Agreement pursuant to Section 10.1, the parties hereto shall have no obligation
or liability to each other except that the provisions of Sections 6.4, 6.7, 7.1,
7.5 and 10.3 survive any such termination.
34
10.3 Expenses. Regent and the Company each represent and warrant to each
other that there is no broker or finder involved in the transactions
contemplated hereby, except for Granite Securities Corp. who will receive a
$25,000 finder's fee from the Company at closing. Regardless of whether the
Merger is consummated, all costs and expenses in connection with this Agreement
and the transactions contemplated hereby incurred by Regent shall be paid by
Regent and all such costs and expenses incurred by the Company shall be paid by
the Company, except that the Company has reimbursed Regent for $5,000 of its due
diligence expenses, which amount is non-refundable.
10.4 Restrictions on Transfer of Regent Stock. Each party to this
Agreement, severally and not jointly with any other Person, (i) acknowledges
that the Preferred Shares and the shares of common stock issuable upon
conversion of the Preferred Shares have not and will not be registered under the
Securities Act and therefore may not be resold without compliance with the
Securities Act and (ii) covenants that none of said securities will be offered,
sold, assigned, pledged, hypothecated, transferred or otherwise disposed of
except after full compliance with all the applicable provisions of the
Securities Act and the rules and regulations of the Commission and applicable
state securities laws and regulations. All certificates evidencing shares of
either the Company Common Stock or Regent's Capital Stock issued pursuant to
this Agreement or upon conversion of Regent's Preferred Shares will bear a
legend in substantially the form below:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT PURPOSES AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
SUCH SHARES ARE REGISTERED UNDER SUCH ACT, AND SUCH STATE LAWS, OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED."
In addition, certificates evidencing shares of Regent Capital Stock issued
pursuant to the Plan of Merger or upon conversion to each Millennium Stockholder
will bear any legend required by the securities or blue sky laws of the state in
which such Millennium Stockholder resides.
10.5 Waiver and Amendment. Any provision of this Agreement may be waived
at any time by the party entitled to the benefits thereof. This Agreement may
not be amended or supplemented at any time, except by an instrument in writing
signed on behalf of each party hereto. The waiver by any party hereto of any
condition or of a breach of another provision of this Agreement shall not
operate or be construed as a waiver of any other condition or subsequent breach.
The waiver by any party hereto of any of the conditions precedent to its
obligations under this Agreement shall not preclude it from seeking redress for
breach of this Agreement other than with respect to the condition so waived.
35
10.6 Public Statements. The Company and Regent agree to consult with each
other prior to issuing any press release or otherwise making any public
statement with respect to the transactions contemplated hereby, and shall not
issue any such press release or make any such public statement prior to such
consultation, except as may be required by Law.
10.7 Assignment. Regent and the Company each agree that they will not
assign this Agreement. Furthermore, no other party to this Agreement may assign
this Agreement without the prior written consent of Regent or the Company.
10.8 Notices. All notices, requests, demands, claims and other
communications which are required to be or may be given under this Agreement
shall be in writing and shall be deemed to have been duly given if (i) delivered
in person or by courier, (ii) sent by telecopy or facsimile transmission, answer
back requested, or (iii) mailed, by registered or certified mail, postage
prepaid, return receipt requested, to the parties hereto at the following
addresses:
if to the Company or any Millennium Stockholder:
▇▇▇▇▇ ▇▇▇▇, President
Millennium Biotechnologies, Inc.
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Esq.
Silverman, Chernis, Shin & ▇▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
if to Regent or Merger Sub:
▇/▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇ ▇▇▇▇▇▇, Esq.
Snow ▇▇▇▇▇▇ ▇▇▇▇▇▇ P.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
36
or to such other address as any party shall have furnished to the other by
notice given in accordance with this Section 10.8. Such notices shall be
effective, (i) if delivered in person or by courier, upon actual receipt by the
intended recipient, (ii) if sent by telecopy or facsimile transmission, when the
answer back is received, or (iii) if mailed, upon the earlier of five (5) days
after deposit in the mail and the date of delivery as shown by the return
receipt therefor. Delivery to the Stockholders' representative identified above
of any notice to Stockholders hereunder shall constitute delivery to all
Stockholders and any notice given by such Stockholders' representative shall be
deemed to be notice given by all Stockholders.
10.9 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of Delaware, excluding any choice of law rules that may
direct the application of the laws of another jurisdiction.
10.10 Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provision, covenants and
restrictions of this Agreement shall continue in full force and effect and shall
in no way be affected, impaired or invalidated unless such an interpretation
would materially alter the rights and privileges of any party hereto or
materially alter the terms of the transactions contemplated hereby.
10.11 Counterparts. This Agreement may be executed in counterparts, each
of which shall be an original, but all of which together shall constitute one
and the same agreement.
10.12 Headings. The Section headings herein are for convenience only and
shall not affect the construction hereof.
10.13 Entire Agreement; Third Party Beneficiaries. This Agreement,
including the Annexes, Exhibits and the Schedules hereto, constitutes the entire
agreement and supersedes all other prior agreements and understandings, both
oral and written, among the parties or any of them, with respect to the subject
matter hereof (except as contemplated otherwise by this Agreement) and neither
this Agreement nor any document delivered in connection with this, confers upon
any Person not a party hereto any rights or remedies hereunder.
[signature page follows]
37
IN WITNESS WHEREOF, Regent Group, Inc. and Millennium Biotechnologies,
Inc. have caused this Agreement to be executed on their behalf by their
respective officers thereunto duly authorized, and the Millennium Shareholders
have caused this Agreement to be executed solely in connection with Article IV
to this Agreement, and any other section to this Agreement, which specifically
mentions a Millennium Stockholder all as of the date first above written.
REGENT GROUP, INC.
By: ________________________________
Name:
Title:
MERGER SUB
By: ________________________________
Name:
Title:
MILLENNIUM BIOTECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title: Pres.
MILLENNIUM STOCKHOLDERS:
Signature: _____________________
Print Name: _____________________
Date: _____________________
38
ANNEX A
SCHEDULE OF DEFINED TERMS
The following terms when used in the Agreement shall have the meanings set
forth below unless the context shall otherwise require:
"Affiliate" means, with respect to any specified Person, any other Person
who directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person.
"Agreement" means the Agreement and Plan of Reorganization made and
entered into as of July 26, 2001, by and among Regent, Merger Sub, and Company
and the Stockholders thereof, including any amendments thereto and each Annex
(including this Annex A), Exhibit and schedule thereto (including the
Schedules).
"Business Day" means any day other than a day on which banks in the State
of New York are authorized or obligated to be closed.
"Closing" means a meeting, which shall be held in accordance with Section
2.3, of representatives of the parties to the Agreement at which, among other
things, all documents deemed necessary by the parties to the Agreement to
evidence the fulfillment or waiver of all conditions precedent to the
consummation of the transactions contemplated by the Agreement are executed and
delivered.
"Closing Date" means the date of the Closing as determined pursuant to
Section 2.3.
"Code" means the Internal Revenue Code of 1986, as amended, and the rules
and regulations promulgated thereunder.
"Company" means Millennium Biotechnologies, Inc., a Delaware corporation
and all its predecessor entities and its successors from time to time.
"Company Common Stock" means the issued and outstanding common stock of
the Company, as set forth in Section 3.7.
"Company 2000 Balance Sheet" has the meaning set forth in Section 3.8.
"Control" (including the terms "controlled," "controlled by" and "under
common control with") means the possession, directly or indirectly or as trustee
or executor, of the power
Annex A-1
to direct or cause the direction of the management or policies of a Person,
whether through the ownership of stock or as trustee or executor, by contract or
credit arrangement or otherwise.
"Court" means any court or arbitration tribunal of the United States, any
foreign country or any domestic or foreign state, and any political subdivision
thereof.
"Effective Time" has the meaning set forth in Section 2.2.
"Environmental Laws" means all federal, state, regional or local statutes,
laws, rules, regulations, codes, orders, plans, injunctions, decrees, rulings,
and changes or ordinances or judicial or administrative interpretations thereof,
as in effect on the Closing Date, any of which govern or relate to pollution,
protection of the environment, public health and safety, air emissions, water
discharges, hazardous or toxic substances, solid or hazardous waste or
occupational health and safety, as any of these terms are in such statutes,
laws, rules, regulations, codes, orders, plans, injunctions, decrees, rulings
and changes or ordinances, or judicial or administrative interpretations
thereof, including, without limitation, RCRA, CERCLA, the Hazardous Materials
Transportation Act, the Toxic Substances Control Act, the Clean Air Act, the
Clean Water Act, FIFRA, EPCRA and OSHA.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the Regulations promulgated thereunder.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the Regulations promulgated thereunder.
"GAAP" means accounting principles generally accepted in the United States
as in effect from time to time consistently applied by a specified Person.
"Governmental Authority" means any governmental agency or authority (other
than a Court) of the United States, any foreign country, or any domestic or
foreign state, and any political subdivision thereof, and shall include any
multinational authority having governmental or quasi-governmental powers.
"Guarantees" has the meaning set forth in Section 3.22 and 5.26, as the
case may be.
"Hazardous Material" means any toxic or hazardous substance, material, or
waste, and any other contaminant, pollutant or constituent thereof, whether
liquid, solid, semi-solid, sludge and/or gaseous, including, without limitation,
chemicals, compounds, metals, by-products, pesticides, asbestos containing
materials, petroleum or petroleum products, and polychlorinated biphenyls, the
presence of which requires remediation under any Environmental, Health and
Safety Laws in effect on the Closing Date, including, without limitation, the
United States Department of Transportation Table (49 CFR 172, 101) or by the
Environmental Protection Agency as hazardous substances (40 CFR Part 302) and
any amendments thereto; the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended
Annex A-2
by the Superfund Amendment and Reauthorization Act of 1986, 42 U.S.C. ss. 9601,
et seq. (hereinafter collectively "CERCLA"); the Solid Waste Disposal Act, as
amended by the Resource Conversation and Recovery Act of 1976 and subsequent
Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. ss. 6901 et seq.
(hereinafter, collectively "RCRA"); the Hazardous Materials Transportation Act,
as amended, 49 U.S.C. ss. 1801, et seq.; the Clean Water Act, as amended, 33
U.S.C. ss. 1311, et seq.; the Clean Air Act, as amended (42 U.S.C. ss.
7401-7642); Toxic Substances Control Act, as amended, 15 U.S.C. ss. 2601 et
seq.; the Federal Insecticide, Fungicide, and Rodenticide Act as amended, 7
U.S.C. ss. 136-136y ("FIFRA"); the Emergency Planning and Community
Right-to-Know Act of 1986 as amended, 42 U.S.C. ss. 11001, et seq. (Title III of
▇▇▇▇) ("EPCRA"); the Occupational Safety and Health Act of 1970, as amended, 29
U.S.C. ss. 651, et seq. ("OSHA"); any similar state statute or regulations
implementing such statutes, laws, ordinances, codes, rules, regulations, orders,
rulings, or decrees, or which has been or shall be determined or interpreted at
any time by any Governmental Authority or Court to be a hazardous or toxic
substance regulated under any other statute, law, regulation, order, code, rule,
order, or decree.
"Indemnifiable Damages" has the meaning set forth in Section 9.1.
"Indemnified Party" has the meaning set forth in Section 9.3.
"Indemnifying Party" has the meaning set forth in Section 9.3.
"Intellectual Property" means all patents, trademarks, copyrights and
other proprietary rights.
"Knowledge" shall mean the actual knowledge of the subject party, or any
director or executive officer of such party, as such knowledge has been or
reasonably should have been obtained in the normal conduct of business.
"Law" means all laws, statutes, ordinances, rules and regulations of the
United States, any foreign country, or any domestic or foreign state, and any
political subdivision or agency thereof, including all decisions of Courts
having the effect of law in each such jurisdiction.
"Licenses" means all licenses, certificates, permits, approvals and
registrations.
"Lien" means any mortgage, pledge, security interest, adverse claim,
encumbrance, lien or charge of any kind (including any agreement to give any of
the foregoing), any conditional sale or other title retention agreement, any
lease in the nature thereof or the filing of or agreement to give any financing
statement under the Law of any jurisdiction.
"Material Contract" has the meaning set forth in Section 3.22 and 5.26, as
the case may be.
"Material Leases" has the meaning set forth in Section 3.22 5.26, as the
case may be.
Annex A-3
"Merger" has the meaning set forth in the Recitals.
"Order" means any judgment, order or decree of any federal, foreign, state
or local Court or Governmental Authority.
"Person" means an individual, partnership, limited liability company,
corporation, joint stock company, trust, estate, joint venture, association or
unincorporated organization, or any other form of business or professional
entity, but shall not include a Court or Governmental Authority.
"Plan" has the meaning set forth in Section 3.13.
"Purchase Price" has the meaning set forth in Section 9.1(d)(ii)
"Regent" means Regent Group, Inc., and all its predecessor entities and
its successors from time to time.
"Related Party Agreements" has the meaning set forth in Sections 3.22 and
5.26, as the case may be.
"Reports" means, with respect to a specified Person, all reports,
registrations, filings and other documents and instruments required to be filed
by the specified Person with any Governmental Authority.
"SEC Documents" has the meaning set forth in Section 5.7.
"Securities Act" means the Securities Act of 1933 and the rules and
regulations promulgated thereunder.
A "Subsidiary" of a specified Person is any corporation, partnership,
limited liability company, joint venture or other legal entity of which the
specified Person (either alone or through or together with any other subsidiary)
owns, directly or indirectly, 50% or more of the stock or other equity or
partnership interests the holders of which are generally entitled to vote for
the election of the board of directors or other governing body of such
corporation or other legal entity or of which the specified Person controls the
management.
"Tax Returns" means all returns, reports and filings relating to Taxes.
"Taxes" means all taxes, charges, imposts, tariffs, fees, levies or other
similar assessments or liabilities, including income taxes, ad valorem taxes,
excise taxes, withholding taxes, stamp taxes or other taxes of or with respect
to gross receipts, premiums, real property, personal property, windfall profits,
sales, use, transfers, licensing, employment, payroll and franchises imposed by
or under any Law; and such terms shall include any interest, fines, penalties,
assessments or additions to tax resulting from, attributable to or incurred in
connection with any such tax or any contest or dispute thereof.
Annex A-4