EXHIBIT 2.1
STOCK EXCHANGE AGREEMENT
This stock exchange ("Agreement") is made effective as of October 24th,
2000, by and between Ted L. Parker, the sole shareholder of CleanWeb, Inc., a
Texas corporation, ("Seller"), and iEXALT, INC., a Nevada corporation,
("Purchaser").
Recitals
The Agreement specifies a reorganization within the meaning of Section
368(a)(1)(B) of the Internal Revenue Code of 1986, as amended. The Purchaser
will acquire from the Seller all of the issued and outstanding stock of CleanWeb
Inc. ("CleanWeb"), a Texas corporation that is in the business of premium
filtered Internet access, in exchange solely for shares of voting stock of the
Purchaser. Under this Agreement, CleanWeb will be come a subsidiary of the
Purchaser.
NOW, THEREFORE, in consideration of mutual covenants contained in this
agreement and other good and valuable consideration, which is acknowledged to be
sufficient, the parties agree as follows:
Terms of Agreement
SECTION 1. STOCK EXCHANGED. Seller agrees to transfer to Purchaser, and
Purchaser agrees to accept from Seller, on the terms and conditions set forth in
this Agreement, all of his stock, of all classes and categories, in CleanWeb.
SECTION 2. LIABILITIES OF CLEANWEB. Purchaser accepts the stock of CleanWeb
subject to all present, future, and contingent debts, obligations, and claims
against CleanWeb except (1) those which are specifically assumed by Seller as
more fully described on Schedule 2.0 and (2) those debts, obligations or claims
of which Seller is either aware, or should, in the exercise of reasonable
diligence, be aware of and failed to disclose to Purchaser.
SECTION 3. PAYMENT FOR STOCK
3.1 The consideration for this transaction is the exchange of stock.
Seller will receive and agrees to accept at closing a total of two million three
hundred thirteen thousand (2,313,000) duly issued shares of Purchaser's fully
paid, irrevocable, voting common stock, par value .001, of iExalt, Inc., a
Nevada Corporation, traded on the NASDAQ "over the counter" bulleting board
system under the symbol "IXLT", restricted under Rule 144 of the Securities and
Exchange Commission; likewise, Purchaser will receive and agrees to accept all
the issued and outstanding shares of preferred and common stock of CleanWeb,
owned by Seller. The number of shares to be paid to Seller is to be adjusted as
follows:
3.1.1 If the number of CleanWeb subscribers on the closing date is
in excess of 6,200, then for every CleanWeb subscriber in excess of
6,200, Seller will receive an additional 242 shares.
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3.1.2 If the number of CleanWeb subscribers on the closing date is
less than 6,000, then for every CleanWeb subscriber less than 6,000,
the number of shares paid to Seller will be reduced by 242 shares.
3.2 In exchange for all of his shares of CleanWeb, Seller agrees to accept
unregistered shares of common stock of Purchaser, which shares will be
restricted under Section 144 of the Securities and Exchange Commission Rules.
The total number of shares of Purchaser's common stock referred to in paragraph
3.1 above are to be restricted under Section 144 of the Securities and Exchange
Commission.
3.3 Purchaser agrees to deliver or cause to be delivered to Seller the
stock certificates in the amounts set forth above in paragraph 3.1 at Closing or
as soon after Closing as is reasonably possible.
3.4 The parties intend to adopt this Agreement as a plan of reorganization
and to consummate it in accordance with the provisions of Section 368(a)(1)(B)
of the Internal Revenue Code of 1986, as amended. The parties shall treat this
Agreement as a tax-free reorganization for all purposes on their respective
books and records, both for financial accounting and tax accounting purposes.
The parties agree to take all actions which are reasonably necessary to treat
this Agreement as a tax-free reorganization.
SECTION 4. Seller's REPRESENTATIONS AND WARRANTIES. Seller represents and
warrants to Purchaser that he has all requisite authority to enter into and
perform the obligations under this Agreement; that none of the stock sold under
this Agreement is pledged, mortgaged, or otherwise encumbered; and that the
books and records of CleanWeb, which have been examined by Purchaser, correctly
represent the financial condition of CleanWeb as of the 31st day of October,
2000. The stock exchanged in this Agreement is predicated upon these
representations. Further, Purchaser is entitled to rely on Seller's unaudited
financial statements including without limitation Seller's most recent income
statement and balance sheet, which such documents do not contain any untrue
statement or omit any material fact therein. All the financial statements listed
in this paragraph present fairly the financial condition of CleanWeb at the
specified dates and the results of its operations for the period specified
provided that normal end of period adjustments are allowed for except that no
provisions have been made to recognize accruals or deferrals of revenues
attributable to customers who pay for their subscriptions on an annual basis.
SECTION 5. REPRESENTATIONS OF Purchaser. Purchaser represents and warrants that
it is a corporation duly organized, validly existing, and in good standing under
the laws of the State of Nevada. Purchaser has all requisite corporate power and
authority to enter into and perform its obligations under this Agreement; the
books and records of Purchaser correctly represent the financial condition of
the company as of the 31st day of October, 2000. The stock exchanged by this
Agreement is predicated upon these representations. Further, Seller is entitled
to rely on Purchaser filings with the Securities and Exchange Commission
including without limitation Purchaser's most recent annual report and quarterly
report, which such filings do not contain any untrue statement or omit any
material fact therein.
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SECTION 6. COVENANTS OF THE PARTIES. Seller and Purchaser agree that between the
date of this Agreement and Closing, the parties will not do anything to cause
any dilution or encumbrance of any type with respect to the stock sold under
this Agreement. Purchaser will use its best efforts to effect the transaction
described in this Agreement and to fulfill all conditions of Purchaser's
obligations under this Agreement. However, it is the intent of both parties that
Purchaser be allowed to consummate those transactions (i.e., acquisitions) which
are already in progress and which are consummated in good faith by Purchaser on
behalf of all of its shareholders.
SECTION 7. CONFIDENTIAL INFORMATION. If for any reason this purchase and sale of
stock is not closed, Purchaser will not use or disclose to third parties any
confidential information received from Seller, and Seller will not use or
disclose to third parties any confidential information received from Purchaser
in the course of investigating, negotiating, and performing the transactions
contemplated by this Agreement.
SECTION 8. FURTHER REPRESENTATIONS AND WARRANTIES
8.1 All representations and warranties made in this Agreement by Seller
and Purchaser shall be true as of Closing as fully as those such representations
and warranties had been made on or as of Closing, and, as of Closing, Seller and
Purchaser shall not have violated or failed to perform in accordance with any
covenant contained in this Agreement.
8.2 At Closing, no suit, action, or other proceeding shall have been
threatened or instituted to restrain, enjoin, or otherwise prevent the
consummation of this Agreement or the contemplated transactions.
SECTION 9. PURCHASER'S ACCEPTANCE. Purchaser represents and acknowledges that it
has entered into this Agreement on the basis of its own examination, personal
knowledge, and opinion as to the value of the assets and business of Seller.
SECTION 10. SURVIVAL. All representations and warranties made in this Agreement
shall survive the Closing of this Agreement.
SECTION 11. CLOSING. This Agreement will be closed at 4301 Windfern Road,
Houston, Texas 77041-8915, on October 31st , 2000, or such other time as the
parties may agree in writing.
SECTION 12. TERMINATION OF AGREEMENT. This Agreement may be terminated by mutual
written consent of Purchaser and Seller.
SECTION 13. MISCELLANEOUS
13.1 The provisions of this Agreement shall be binding upon and inure to
the benefit of the heirs, personal representatives, successors, and assigns of
the parties.
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13.2 Any notice or other communication required or permitted to be given
under this Agreement shall be in writing and shall be mailed by certified mail,
return receipt requested, postage prepaid, or by commercial carrier, addressed
to the parties as follows:
Seller: Shareholder of CleanWeb, Inc. Purchaser: iExalt, Inc.
Ted L. Parker Donald W. Sapaugh, CEO
2002 W. Loop 289, Suite 105 4301 Windfern Road, Ste. 200
Lubbock, TX 79407 Houston, TX 77041-8915
806-473-3030; fax (281) 600-4000; fax
With A Copy To: With A Copy To:
Mark Kohler
PO Box 54450
Lubbock, Texas 79453
13.3 Public Announcement. All press releases and public announcements
relating to this Agreement will be agreed to and prepared jointly by Seller and
Purchaser.
13.4 Expenses. Each party will be responsible for all of its own expenses,
including legal fees, incurred in connection with this Agreement.
13.5 Indemnification. Seller represents and warrants that Purchaser will
not incur any undisclosed liability in connection with the acquisition of
Seller's stock in CleanWeb, to any third party arising from Seller's written
representations to such third party, and Seller agrees to indemnify, defend, and
hold harmless Purchaser, its officers, directors, stockholders, lenders, and
affiliates from any claims by or liabilities to such third parties, including
any legal or other expenses incurred in connection with the defense of such
claims. Each party agrees to indemnify the other party for all representations,
warranties and covenants made in this Agreement. However, such indemnity shall
be limited by the amount of consideration paid.
13.6 Partial Invalidity. If any part of any provision of this Agreement is
held to be invalid or unenforceable under applicable law, that part or provision
will be ineffective to the extent of such invalidity or unenforceability,
without in any way affecting the remaining parts of this Agreement, which shall
be construed and enforced as if such invalid or unenforceable part or provision
had not been inserted.
13.7 Dispute Resolution. Both parties agree to follow the RULES OF
PROCEDURE FOR CHRISTIAN CONCILIATION of the Institute for Christian Conciliation
(a division of Peacemaker Ministries) for any and all disputes concerning or
arising from or under this Agreement. Both parties agree that the Bible commands
parties to make every effort to resolve disputes with each other in private (SEE
Matthew 18:15-20; 1 Corinthians 6:1-9) and in obedience agree to proceed to
legally binding arbitration before a mutually agreed arbitrator. Both parties
realize that arbitration will be the exclusive remedy for potential disputes and
may not later litigate these or any other related matters in civil court.
13.8 This Agreement shall be governed by and shall be construed in
accordance with the laws of the State of Texas.
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13.9 This Agreement constitutes the entire agreement between the parties
pertaining to its subject matter and it supersedes all prior contemporaneous
agreements, representations, and understandings of the parties. No supplement,
modification, or amendment of this Agreement shall be binding unless executed in
writing by all parties. This Agreement may be executed simultaneously in one or
more counterparts with the same effect as if the signatories executing the
several counterparts had executed one original.
DATE: The parties have signed this agreement on October 24th, 2000.
Seller: Purchaser:
iEXALT, INC.
/s/ TED L. PARKER BY: /s/ DONALD W. SAPAUGH
Ted L. Parker Donald W. Sapaugh, CEO
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