EXCHANGE OF STOCK AGREEMENT AND PLAN OF REORGANIZATION
Exchange of Stock Agreement and Plan of Reorganization dated July 16, 1996
(the "Agreement"), by and between CEEE GROUP CORPORATION ("CEEE"), a Colorado
corporation having its principal place for the transaction of business at 51
Hudson Point Lane, Ossining, New York 10562, EDWARD COWLE, residing at 708 3rd
Avenue, New York, N.Y. 10017 ("Cowle"), DEWORTH WILLIAMS, residing at 56 West
400 South, Salt Lake City, Utah 84101 ("Williams"), ATLANTIC INTERNATIONAL
CAPITAL, LTD., a Delaware corporation having its principal place for the
transaction of business at 2200 Corporate Blvd., Suite 317, Boca Raton, Florida
33431 ("Atlantic"), and each of the stockholders of the Corporation listed on
Schedule I attached hereto (each, a "Stockholder" and collectively, the
"Stockholders").
W I T N E S E T H:
WHEREAS, the Stockholders represent all stockholders of Atlantic who
collectively own 100 shares of common stock, par value $.01 per share, of
Atlantic (the "Atlantic Stock") which constitutes all of the issued and
outstanding shares of the common stock of Atlantic; and
WHEREAS, CEEE currently has an authorized capitalization of at least
10,000,000 shares of Common Stock, $.001 par value per share (the "CEEE Stock")
of which 1,500,033 shares are issued and outstanding; and
WHEREAS, CEEE desires to acquire from the Stockholders all of the Atlantic
Stock in exchange solely for 7,000,000 shares of CEEE Stock (the "Exchange
Shares"); and
WHEREAS, it is the intention of CEEE that, upon the amendment of the
Certificate of Incorporation of CEEE more fully described in Article VII hereof,
CEEE will issue to the Stockholders, in the aggregate, an additional 18,183,759
shares (the "Additional Shares") of CEEE Stock as set forth under the column
"Number of Additional Shares to be Received on Schedule I; and
WHEREAS, it is the intention of CEEE and Atlantic that the exchange of the
Corporation Stock for the Exchange Shares constitute a "reorganization" as
defined in Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as
amended.
NOW THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained, IT IS AGREED as follows:
ARTICLE I
EXCHANGE OF STOCK
Section 1.1 Exchange of Stock. Subject to the terms and conditions of this
Agreement, at the "Closing" as such term as defined in Section 7.1 hereof, the
Atlantic Stock shall be exchanged by the Stockholders with CEEE for the Exchange
Shares in the respective amounts for each Stockholder set forth opposite his
name on Schedule I hereto under the column "Number of Exchange Shares to be
Received."
Section 1.2 Delivery of Certificates. At the Closing, the certificates
representing all of the outstanding shares of Atlantic Stock duly endorsed to
CEEE with signatures guaranteed and with all requisite stock transfer tax stamps
affixed, shall be delivered to CEEE. The cost of any transfer tax stamps
required to be affixed to any stock certificates shall be paid by Atlantic. Upon
delivery by CEEE of the certificates evidencing the Exchange Shares, the
Stockholders shall be vested with good and valid title to such Exchange Shares,
free and clear of all liens, claims and encumbrances, other than those created
by the Stockholders. The Exchange Shares and the Additional Shares shall
together constitute approximately 94.012% of the outstanding capital stock of
CEEE.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF CEEE
CEEE represents and warrants to the Stockholders and Atlantic as follows:
Section 2.1 Organization and Qualification of CEEE. CEEE is a corporation
duly incorporated, duly organized, validly existing and in good standing under
the laws of the State of Colorado. CEEE has the corporate power and authority to
own or lease and operate all of its properties and assets and to carry on its
business as such business in now being conducted and is duly licensed or
qualified to do business and is in good standing in all states in which the
nature of the business conducted by CEEE or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualifications necessary and where the failure to qualify would not have a
material adverse effect on the conditions (financial or otherwise), operations,
properties, assets, liabilities, earnings or business of CEEE or on the
enforceability of any contract or commitment referred to in Section 2.14 hereof
or give rise to any obligation for taxes. Norman Hoskin and Richard Iamunno, as
representatives of Atlantic and the Stockholders (the "Representatives") have
received copies of CEEE's Certificate of Incorporation, certified by the
Secretary of State of the State of Colorado as of a recent date, and of CEEE's
By-Laws, certified
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by its Secretary, which Certificate and By-Laws are complete and correct.
Section 2.2 Capitalization and Ownership of CEEE. The authorized capital
stock of CEEE consists of 10,000,000 shares of Common Stock, $.001 par value per
share, of which 1,500,033 shares are issued and outstanding. The authorized
capitalization is based upon the Amendments to the Articles of Incorporation
filed with the State of Colorado on April 10, 1987, in connection with certain
Articles of Merger filed the same date, which Articles of Amendment changed the
authorized capitalization of CEEE from 10,000,000 shares of $.001 par value
common stock, to 100,000,000 shares of $.001 par value common stock. The Merger
Agreement to which the Articles of Merger relate was subsequently rescinded by
court action, however, no action has been taken by CEEE to notify the State of
Colorado of this rescission and no determination has been made as to the effect
the rescission shall have on the authorized capitalization. All outstanding
shares of CEEE Stock are validly issued, fully paid and nonassessable with no
personal liability attaching to the ownership thereof and free of pre-emptive
rights. There are no shares of CEEE Stock issued or outstanding except as
referred to above and, except as set forth on Schedule 2.2 hereto, there are no
options, calls, subscriptions, warrants, rights, agreements or commitments of
any character obligating CEEE, contingently or otherwise, to issue shares of
CEEE's capital stock or to register shares of CEEE's capital stock under the
Securities Act of 1933, as amended (the "Securities Act"), or any other
applicable Federal or state securities laws.
Section 2.3 No Violations. The execution and delivery of this Agreement by
CEEE will not violate any provisions of CEEE's Certificate of Incorporation or
By-Laws, conflict with any law, rule, statute or regulation to which CEEE is
subject or violate or result in a default under any agreement to which CEEE is a
party or by which it is bound.
Section 2.4 SEC Filings. CEEE has filed with the Securities and Exchange
Commission (the "SEC") all statements and documents which it is required to so
file (the "Filings"). CEEE has been subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended, (the "Exchange Act") since November
15, 1995 (the "Reporting Date"). Copies of all Filings made since the Reporting
Date have been provided to the Representatives. All such Filings are accurate
and complete in all material respects.
Section 2.5 Investments. CEEE has not made any investments and does not
own any capital stock of any other corporation or other entity.
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Section 2.6 Consents and Approvals. To the best knowledge of CEEE, no
permit, consent, approval or authorization of, or declaration, filing or
registration with, any public body or authority or other person, firm or entity
is necessary in connection with the execution and delivery by CEEE of this
Agreement or the consummation by it of the transactions contemplated hereby.
Section 2.7 Compliance with Law. CEEE holds all licenses, franchises,
permits and authorizations necessary for the lawful conduct of its business, and
has complied and is in compliance with all applicable statutes, laws,
ordinances, rules and regulations of all Federal, state, local and foreign
governmental bodies, agencies and subdivisions having, asserting or claiming
jurisdiction over it or over any part of its operations and, to the best of its
knowledge, currently is not in violation of any thereof, except for such
licenses, franchises, permits and authorizations, the lack of which, and for
such statutes, laws, ordinances, rules and regulations, non-compliance or
violation of which, in any one case or in the aggregate, would not have a
materially adverse effect on the condition (financial or otherwise), operations,
properties, assets, liabilities, earnings, or business of CEEE, or impair CEEE's
ability to consummate the transactions contemplated hereby. In connection with
any sale of any securities CEEE has complied with the Securities Act of 1933, as
amended (the "Securities Act"), the Exchange Act, and all rules and regulations
of the SEC and the laws, rules and regulations of each state in which such
securities are offered for sale.
Section 2.8 Financial Statements. The Representatives have received copies
of the audited financial statements of CEEE for the fiscal years ended December
31, 1994 and December 31, 1995 (the "Financial Statements") including the
related balance sheets, statements of operations, statement of changes in
shareholders' equity for such years and the notes thereto, accompanied by the
reports of Jones, Jensen & Co., 349 South 200 East, Salt Lake City, Utah 84111,
Certified Public Accountants for CEEE. The Financial Statements (a) present
fairly the financial position, results of operations and changes in financial
position of CEEE, as of the respective dates and for the respective periods
indicated, and (b) have been prepared in accordance with generally accepted
accounting principles ("GAAP") consistently applied. The balance sheet of CEEE
as of December 31, 1995 reflects no total liabilities (the "Total Liabilities").
Section 2.9 Existing Condition. Except as disclosed in Schedule 2.9
hereto, since the date of the December 31, 1995 Financial Statements, CEEE has
not:
(a) incurred any liabilities;
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(b) sold, encumbered, assigned or transferred any of its assets;
(c) made or suffered any amendment or termination of any material
agreement, contract, commitment, lease under which CEEE is lessee, or cancelled,
modified or waived any significant debts or claims held by it or waived any
rights of significant value, whether or not in the ordinary course of business;
(d) suffered any damage, destruction or loss, whether or not covered by
insurance;
(e) suffered any material adverse change in its business, operations,
assets, properties, prospects or condition (financial or otherwise);
(f) made commitments or agreements for capital expenditures;
(g) hired any employees;
(h) changed any of the accounting principles followed by it or the methods
of applying such principles;
(i) entered into any transaction other than this Agreement; or
(j) issued any shares of its capital stock.
Section 2.10 Title to Properties; Leasehold Interests. CEEE has good and
valid title to all properties and assets, real, personal and mixed, free and
clear of all mortgages, liens, pledges, security interests, charges, claims,
restrictions and other encumbrances and defects of title of any nature
whatsoever, except for liens for taxes not yet due and payable.
Section 2.11 Condition of Tangible Assets. All material items of tangible
personal property are in good condition and repair, subject to normal wear and
tear, and are usable in the regular and ordinary course of business of CEEE.
Section 2.12 Books of Account. The books, records and accounts of CEEE
maintained with respect to the business of CEEE accurately and fairly reflect,
in reasonable detail, all the transactions and all the assets and liabilities of
CEEE. CEEE has not engaged in any transaction, maintained any bank account or
used any of its funds except for transactions, bank accounts and funds which
have been and are reflected in the normally maintained books and records of the
business.
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Section 2.13 Litigation. No litigation, including any arbitration,
investigation or other proceeding of or before any court, arbitrator or
governmental or regulatory official, body or authority is pending or, to the
best of CEEE's knowledge, threatened against CEEE. CEEE is not a party to or
subject to the provisions of any judgment, order, writ, injunction, decree or
award of any court, arbitrator or governmental or regulatory official, body or
authority which may materially and adversely affect the business or assets of
CEEE.
Section 2.14 Contracts and Commitments. Except as listed and annexed to
Schedule 2.14 hereto, CEEE is not a party to any written or oral:
(a) agreement, contract or commitment with any present or former employee
or consultant or for the employment of any person;
(b) agreement contract or commitment for the future purchase of, or
payment for, equipment, supplies or products, or for the performance of services
by a third party except for any agreement, contract or commitment arising in the
ordinary course of business;
(c) agreement, contract or commitment to finance any acquisition of or
purchase any asset or to perform any service; or
(d) note, debenture, bond, equipment trust agreement, letter of credit
agreement, loan agreement or other contract or commitment for the borrowing or
lending of money or agreement or arrangement for a line of credit or guarantee,
pledge or undertaking of the indebtedness of any other person.
Each of the agreements, contracts, commitments, leases, plans and other
instruments, documents and undertakings listed on Schedule 2.14 is valid and
enforceable in accordance with its terms except as the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting the rights of
creditors generally; CEEE is not in default of the performance, observance or
fulfillment of any material obligations, covenant or condition contained
therein; and no event has occurred which with or without the giving of notice or
lapse of time, or both, would constitute a default thereunder; furthermore,
except as may be disclosed on Schedule 2.14, no such agreement, contract,
commitment, lease, plan or other instrument, document or undertaking, in the
reasonable opinion of CEEE, contains any contractual requirement with which
there is a likelihood CEEE will be unable to comply.
Section 2.15 No Broker or Finder. CEEE has not dealt with or retained any
finder or broker whose fees or expenses have
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been paid by CEEE or for whose fees or expenses CEEE or Atlantic would be
responsible in connection with this Agreement or the transactions contemplated
hereby.
Section 2.16 Personnel and Certain Authorized Persons. Schedule 2.16
hereto contains a true and complete list of all bank accounts of CEEE and the
names of all persons who are authorized signatories with respect to such
accounts.
Section 2.17 Employees; Employee Benefit Plans and Arrangements. CEEE has
no employees and has not sponsored, maintained or supported, or otherwise been a
party to, in default under, or had any liability or accrued obligations under,
any plan, program, fund or arrangement, either qualified or non-qualified for
Federal income tax purposes, relating to the employees of CEEE, whether for the
benefit of a single individual or for more than one individual, and whether or
not funded, including, without limitation, any incentive or other benefit
arrangement for employees, their dependents and/or their beneficiaries and any
"employee pension benefit plan" or "employee welfare benefit plan", as such
terms are defined in Section 3 of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"). CEEE has not, at any time, maintained or contributed
or been required to maintain or contribute to any "Multi-Employer Plan" as such
term is defined in Section 3(37) of ERISA.
Section 2.18 Completeness of Disclosure. No representation or warranty in
this Agreement nor any certificate, statements, document or instrument furnished
or to be furnished to the Representatives and Atlantic by CEEE pursuant hereto,
or in connection with the negotiation, execution or performance of this
Agreement, contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact required to be stated herein or
therein or necessary to make any statement herein or therein not misleading.
Section 2.19 Tax Matters. CEEE has filed or will file on a timely basis
(including all extensions) all tax returns which were required to have been
filed, or are hereafter required to be filed up to the Closing Date by it
(including, without limitation, all Federal, state, county, local and foreign
tax returns) and such returns are complete and accurate in all material
respects, and CEEE has paid or provided for all taxes, interest or penalties
which have been incurred or are due and payable pursuant to such returns or
pursuant to any assessments received by it in connection with such returns. No
foreign, Federal, state, local or other taxing authority has provided CEEE with
any notice of any questions relating to, or claims asserted for, taxes against
CEEE or for which CEEE may be liable. All taxes which CEEE is required by law to
withhold or collect have
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been duly withheld or collected and, to the extent required, have been paid over
to the proper governmental authorities.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF ATLANTIC AND THE STOCKHOLDERS
A. Atlantic represents and warrants to CEEE as follows:
Section 3.1 Organization and Qualification of Atlantic. Atlantic is a
corporation duly incorporated, duly organized, validly existing and in good
standing under the laws of Delaware. Atlantic has the corporate power and
authority to own or lease and operate all of its properties and assets and to
carry on its business as such business is now being conducted and is duly
licensed or qualified to do business and is in good standing in all
jurisdictions in which the nature of the business conducted by Atlantic or the
character or location of the properties and assets owned or leased by it makes
such licensing or qualifications necessary and where the failure to qualify
would not have a material adverse effect on the conditions (financial or
otherwise), operations, properties, assets, liabilities, earnings or business of
Atlantic.
Section 3.2 Capitalization and Ownership of Atlantic. The authorized
capital stock of Atlantic consists of 100 shares of Common Stock, no par value
per share, all of which are issued and outstanding. All outstanding shares of
Atlantic Stock are validly issued and outstanding, fully paid and nonassessable
with no personal liability attaching to the ownership thereof, free of
preemptive rights and are owned free and clear of all liens, claims and
encumbrances. There are no shares of Atlantic Stock issued or outstanding except
as referred to above, and there are no options, calls, subscriptions, warrants,
rights, agreements or commitments of any character obliging Atlantic,
contingently or otherwise, to issue shares of Atlantic's capital stock or to
register shares of Atlantic's capital stock under the Securities Act or any
other applicable Federal or state securities laws. The Stockholders are the
record and beneficial owners of all of the issued and outstanding shares of
Atlantic Stock, free and clear of all liens and encumbrances.
Section 3.3 Authority. Atlantic has the full power and authority to enter
into this Agreement and to carry out its obligations hereunder. Other than
approval by the Board of Directors and/or stockholders of Atlantic, no
proceedings, on the part of Atlantic are necessary to authorize this Agreement
or the transactions contemplated hereby. This Agreement constitutes the legal,
valid and binding obligation of Atlantic enforceable in accordance with its
terms.
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Section 3.4 Consents and Approvals. No permit, consent, approval or
authorization of, or declaration, filing or registration with, any public body
or authority or other person, firm or entity is necessary in connection with the
execution and delivery by Atlantic or the Stockholders of this Agreement or the
consummation by the Stockholders or Atlantic of the transactions contemplated
hereby.
Section 3.5 Completeness of Disclosure. No representation or warranty in
this Agreement nor any certificate, Schedule, statements, document or instrument
furnished or to be furnished to CEEE by Atlantic pursuant hereto, or in
connection with the negotiation, execution or performance of this Agreement,
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact required to be stated herein or therein or
necessary to make any statement herein or therein not misleading.
Section 3.6 Litigation. No litigation, including any arbitration,
investigation or other proceeding of or before any court, arbitrator or
governmental or regulatory official, body or authority is pending or, to the
best of Atlantic's knowledge, threatened against Atlantic. Atlantic is not a
party to or subject to the provisions of any judgment, order, writ, injunction,
decree or award of any court, arbitrator or governmental or regulatory official,
body or authority which may materially and adversely affect the business or
assets of Atlantic.
Section 3.7 Tax Matters. Atlantic has filed or will file on a timely basis
(including all extensions) all tax returns which were required to have been
filed, or are hereafter required to be filed up to the Closing Date by it
(including, without limitation, all Federal, state, county, local and foreign
tax returns) and such returns are complete and accurate in all material
respects, and Atlantic has paid or provided for all taxes, interest or penalties
which have been incurred or are due and payable pursuant to such returns or
pursuant to any assessments received by it in connection with such returns. No
foreign, Federal, state, local or other taxing authority has provided Atlantic
with any notice of any questions relating to, or claims asserted for, taxes
against Atlantic or for which Atlantic may be liable. All taxes which Atlantic
is required by law to withhold or collect have been duly withheld or collected
and, to the extent required, have been paid over to the proper governmental
authorities.
B. Each of the Stockholders represents and warrants to CEEE that (i) such
Stockholder has such knowledge and experience that such Stockholder is capable
of evaluating the merits and risks of acquiring the Exchange Shares and the
Additional Shares and of making an informed decision, (ii) such Shareholder is
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acquiring the Exchange Shares and the Additional Shares for investment for such
Stockholder's own account and not with a view to, or for resale in connection
with, any distribution thereof and understands that the Exchange Shares and the
Additional Shares have not been registered under the Securities Act by reason of
a specified exemption from the registration provisions of the Securities Act
which depends upon, among other things, the bona fide nature of such
Stockholder's intent as expressed herein, and (iii) such Stockholder is an
"accredited investor" within the meaning of Rule 501 under the Securities Act or
has such knowledge, sophistication and experience in business and financial
matters so as to be capable of evaluating the merits and risks of the
prospective investment, is able to bear the economic risk of such investment,
and at the present time, is able to afford a complete loss of such investment.
ARTICLE IV
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
Section 4.1 Survival of Representations and Warranties. The
representations and warranties made by the parties in this Agreement or in any
certificate, Schedule, document or instrument furnished hereunder shall survive
for two years from the closing of the transactions contemplated hereby.
ARTICLE V
AGREEMENTS PENDING CLOSING
Section 5.1 Agreement Pending the Closing. Each of Atlantic and CEEE
covenant and agree that, pending the Closing (if the Closing shall not occur on
the date hereof) and except as otherwise agreed to in writing by the other
parties:
(a) Business in the Ordinary Course. Its business shall be conducted
solely in the ordinary course.
(b) Maintenance of Physical Assets. It shall continue to maintain and
service the physical assets used in the conduct of its business in the same
manner as has been its consistent past practice.
(c) Employees and Business Relations. It shall continue to maintain its
business relations and relations with its employees, if any, in the same manner
as has been its consistent past practice.
(d) Compliance with Law. etc. It shall comply with all laws, ordinances,
rules, regulations and orders applicable to it or their operations, assets or
properties in respect thereof, the noncompliance with which might materially
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affect its business or assets including, without limitation in the case of CEEE
the filing of all reports required by the Securities Act and the Exchange Act.
(e) Cooperation. It shall cooperate with the other parties to this
Agreement and use its best efforts to cause all of the conditions to the
obligations on its part to be performed under this Agreement to be satisfied on
or prior to the Closing Date.
(f) Sales of Assets; Negotiations. It shall not, directly or indirectly,
sell or encumber all or any part of its assets, other than in the ordinary
course of business consistent with past practice, or initiate or participate in
any discussions or negotiations or enter into any agreement to do any of the
foregoing.
(g) Access. Each of Atlantic and CEEE shall give to the other's officers,
employees, counsel, accountants and other representatives free and full access
to and the right to inspect, during normal business hours, all of the premises,
properties, assets, records, contracts and other documents relating to it and
shall permit the other to consult with its officers, employees, accountants,
counsel and agents for the purpose making such investigation as it desires to
make, provided that such investigation shall not unreasonably interfere with its
business operations.
(h) Press Releases. Except as required by applicable law, no party hereto
shall give notice to third parties or otherwise make any public statement or
releases concerning this Agreement or the transactions contemplated hereby
except for such written information as shall have been approved in writing as to
form and content by all parties hereto.
(i) Confidentiality. Pending the Closing and except as required by
applicable law or otherwise agreed to in writing unless and until the Closing
has been consummated, it will hold, and shall cause its counsel, agents and
independent representatives to hold in confidence any confidential data or
information made available to it in connection with this Agreement with respect
to which it shall use the same standard of care to protect such confidential
data or information as is used to protect its own confidential information. If
the transactions contemplated by this Agreement are not consummated, it agrees
that it shall (i) return or cause to be returned to the party furnishing such
data or information all written materials and all copies thereof that were
supplied to it; and (ii) continue to hold in confidence all such confidential
information and data.
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ARTICLE VI
CONDITIONS PRECEDENT TO THE CLOSING
Section 6.1 Conditions Precedent to Atlantic's Obligations. All
obligations of Atlantic and the Stockholders' under this Agreement are subject
to the fulfillment or satisfaction, and CEEE covenants and agrees to the
fulfillment or satisfaction, prior to or at the Closing, of each of the
following conditions precedent:
(a) Representations and Warranties True as of the Closing Date. The
representations and warranties of CEEE and Cowle contained in this Agreement or
in a Schedule, certificate or document delivered by CEEE to Atlantic or the
Representatives pursuant to the provisions hereof shall be true on the date
hereof without regard to any updates furnished by CEEE after the date hereof and
shall be true on the Closing Date with the same effect as though such
representations and warranties were made as of such date.
(b) Compliance with this Agreement. CEEE shall have performed and complied
with all agreements and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing.
(c) No Threatened or Pending Litigation. On the Closing Date, no suit,
action or other proceeding, or injunction or final judgment relating thereto,
shall be threatened or be pending before any court or government or regulatory
official, body or authority in which it is sought to restrain or prohibit or to
obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby, and no investigation that
might result in any such suit, action or proceeding shall be pending or
threatened.
(d) Consents and Approvals. All of the consents required to carry out the
transactions contemplated hereunder have been obtained.
(e) Material Adverse Changes. There has been no material adverse change in
the business, operations, assets or properties of CEEE.
(f) Approval of Counsel; Corporate Matters. All actions, proceedings,
resolutions, instruments and documents required to carry out this Agreement or
incidental hereto and all other related legal matters shall have been approved
on the Closing Date by counsel Atlantic in the exercise of their reasonable
judgment.
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(g) Counsel Opinion. Atlantic shall have received from Colorado counsel
for CEEE an opinion, reasonably acceptable to counsel for Atlantic, to the
effect that (i) the issuance of the Exchange Shares does not require the
approval of the stockholders of CEEE, (ii) CEEE has the corporate power and
authority to enter into this Agreement and to carry out the transactions
contemplated hereby and (iii) CEEE is duly incorporated and is validly existing
as a corporation in good standing under the laws of Colorado.
(h) Certificates. CEEE shall have delivered to the Stockholders
certificates for the Exchange Shares and CEEE shall also have delivered to the
Stockholders such other documents, instruments, certifications and further
assurances as its counsel may reasonably require.
(i) Directors and Officers. The directors and officers of CEEE shall have
resigned and CEEE shall have caused those directors and officers designated by
the Representatives to be appointed.
(j) No Liabilities. CEEE shall have no liabilities or obligations, either
accrued, absolute, contingent or otherwise except for its ongoing obligation to
file periodic reports with the SEC. For purposes of this Agreement, the terms
"liabilities" shall include, without limitation, any direct or indirect
indebtedness, guaranty, endorsement, indemnity, claim, loss, damage, deficiency,
cost, expense, or obligation, fixed or unfixed, choate or inchoate, liquidated
or un-liquidated, secured or unsecured or a reserve for any of the foregoing.
(k) Forms 10-K and 10-Q. CEEE shall have filed with the SEC an Annual
Report on Form 10-K for the year ended December 31, 1995 and a Quarterly Report
on Form 10-Q for the quarter ended March 31, 1996.
Section 6.2 Conditions Precedent to the Obligations of CEEE. All
obligations of CEEE under this Agreement are subject to the fulfillment or
satisfaction, prior to or at the Closing, of each of the following conditions
precedent:
(a) Representations and Warranties True as of the Closing Date. The
representations and warranties of Atlantic contained in this Agreement or in any
list, certificate or document delivered by the Representatives or Atlantic to
CEEE pursuant to the provisions hereof shall be true on the Closing Date with
the same effect as though such representations and warranties were made as of
such date.
(b) Compliance with this Agreement. Atlantic shall have performed and
complied with all agreements and
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conditions required by this Agreement to be performed or complied with by them
prior to or at the Closing.
(c) No Threatened or Pending Litigation. On the Closing Date, no suit,
action or other proceeding, or injunction of final judgment relating thereto,
shall be threatened or be pending before any court or governmental or regulatory
official, body or authority in which it is sought to restrain or prohibit or to
obtain damages or other relief in connection with this Agreement or the
consummation of the transactions contemplated hereby, and no investigation that
might result in any such suit, action or proceeding shall be pending or
threatened.
(d) Material Adverse Changes. There shall have been no material adverse
changes in the business, operations, assets or properties of Atlantic.
(e) Approval of Counsel; Corporate Matters. All actions, proceedings,
resolutions, instruments and documents required to carry out this Agreement or
incidental hereto and all other related legal matters shall have been approved
on the Closing Date by counsel for CEEE in the exercise of its reasonable
judgment.
(f) Certificates. The Representatives shall have delivered to CEEE one or
more certificates for Atlantic Stock and the Representatives shall have also
delivered to CEEE such other documents, instruments, certifications and further
assurances as its counsel may reasonably require.
ARTICLE VII
CLOSING, FURTHER ASSURANCES
AND CONDITIONS SUBSEQUENT
Section 7.1 Closing. The Closing (the "Closing") of the exchange of
Atlantic Stock and the Exchange Shares shall take place at the offices of Olshan
Grundman Frome & Rosenzweig, 505 Park Avenue, New York, New York 10022 on the
date hereof or such other date as may be mutually agreed upon in writing by the
parties hereto. The date of the Closing is sometimes herein referred to as the
"Closing Date".
Section 7.2 Acts to be Performed by CEEE Following the Closing. Following
the Closing, CEEE shall:
(a) Cause there to be held a meeting of stockholders of CEEE at which (i)
the name of CEEE shall be changed to "Atlantic International Entertainment,
Ltd.", or such other name as the Representatives shall request (ii) the
authorized capital stock of CEEE shall be increased to 110,000,000 shares of
CEEE Stock authorized (the "Capital Authorization"), and (iii) all of the CEEE
Stock outstanding
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(including the Exchange Shares and the Additional Exchange Shares) shall be
split 1 for 3;
(b) Immediately following the Capital Authorization, cause to be issued to
the Stockholders the Additional Shares.
(c) change the address of its principal executive offices and to take all
actions necessary to qualify to transact business in the jurisdiction thereof
and all other jurisdictions in which the nature of the business conducted by
CEEE or the character or location of the properties and assets owned or leased
by it make such qualification necessary, except where the failure to so qualify
would not have a material adverse effect on CEEE; and
(d) execute the appropriate certificates and make the appropriate public
filings to effectuate each of the foregoing actions.
(e) pay to each of Cowle and Williams $25,000 upon the sale by CEEE of
greater than $500,000 of securities.
Section 7.3 Further Assurances. Each of the parties from time to time
after the Closing, at the other's request, will execute, acknowledge and deliver
to the other such other instruments of conveyance and transfer and will take
such other actions and execute and deliver such other documents, certifications
and further assurances as the other may reasonably require in order to vest more
effectively Atlantic Stock, the Exchange Shares and the Additional Shares, as
the case may be, in the owner thereof. Each of the parties hereto will cooperate
with the other and execute and deliver to the other parties hereto such other
instruments and documents and take such other actions as may be reasonably
requested from time to time by any other party hereto as necessary to carry out,
evidence and confirm the intended purposes of this Agreement.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 Termination.
(a) Anything herein or elsewhere to the contrary notwithstanding, this
Agreement may be terminated by written notice of termination at any time before
the Closing Date only as follows:
(i) by mutual consent of Atlantic, the Representatives and CEEE;
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(ii) by the Stockholders and Atlantic at any time if the representations
and warranties of CEEE and Cowle were materially incorrect when made;
(iii) by CEEE at any time if the representations and warranties of
Atlantic were materially incorrect when made; or
(iv) by any party hereto if the transactions contemplated by this
Agreement do not close on or before July 31, 1996 unless extended in writing by
mutual agreement of the parties hereto.
(b) In the event of the termination and abandonment hereof pursuant to the
provisions of this Section 8.01, this Agreement, except as provided in this
Section 8.01(b) shall become void and have no effect, without any liability on
the part of any of the parties or their directors or officers or stockholders in
respect of this Agreement. Notwithstanding any such termination and abandonment,
the provisions of Section 5.01(i) regarding confidential information shall
remain binding upon the parties hereto.
Section 8.2 Brokers' and Finders' Fees. Each party represents and warrants
to the other that all negotiations relative to this Agreement have been carried
on by it directly without the intervention of any person, and each of the
parties agree to indemnify and hold the other harmless against any and all
claims, losses, liabilities and expenses which may be asserted against or
incurred by it as a result of its dealings, arrangements or agreements with any
such person.
Section 8.3 Income, Sales, Transfer and Documentary Taxes; etc. Atlantic
shall pay all Federal, state and local income taxes, if any, due as a result of
the purchase, sale or transfer of the Exchange Shares, the Additional Shares and
the Atlantic Stock in accordance herewith.
Section 8.4 Expenses. Each party hereto shall pay its own expenses
incidental to the preparation of this Agreement and the transactions
contemplated hereby.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
on the date first above written.
ATLANTIC INTERNATIONAL CAPITAL,
LTD.
By:/s/ Richard Iamunno
-------------------------------------
Name: Richard Iamunno
Title: President
CEEE GROUP CORPORATION
By:Edward A. Cowle
-------------------------------------
Name: Edward A. Cowle
Title: President and Chief
Executice Officer
/s/ Norman Hoskin
----------------------------------------
Norman Hoskin
THE KUNNI LEMMEL TRUST
By:/s/ Hilberto DeFrias
-------------------------------------
/s/ Richard Iamunno
----------------------------------------
Richard Iamunno
THE AWIXA TRUST
By: /s/ Hilberto DeFrias
------------------------------------
/s/ Robert L. Frome
----------------------------------------
Robert L. Frome
Robert H. Friedman
----------------------------------------
Robert H. Friedman
CENTERLINE ASSOCIATES
By: Jeanne Williams
------------------------------------
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/s/ Eithne Wilmott
----------------------------------------
Eithne Wilmott
/s/ Edward Cowle
----------------------------------------
Edward Cowle
/s/ DeWorth Williams
----------------------------------------
DeWorth Williams
/s/ James Dougherty
----------------------------------------
James Dougherty
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Schedule I
Number of Number of
Number of Exchange Additional Total Number
Shares of Shares to be Shares to be of Shares to
Name of Stockholder Atlantic Held Received Received be Received
- ------------------- ------------- -------- -------- -----------
Norman Hoskin 13.5 945,000 2,454,587 3,399,587
2200 Corporate Blvd.
Suite 317
Boca Raton, FL 33431
THE KUNNI LEMMEL 30.0 2,100,000 5,454,638 7,554,638
TRUST
c/o Norman Hoskin
2200 Corporate Blvd.
Boca Raton, FL 33431
Richard Iamunno 13.5 945,000 2,454,587 3,399,587
2200 Corporate Blvd.
Suite 317
Boca Raton, FL 33431
THE AWIXA TRUST 30.0 2,100,000 5,454,638 7,554,638
c/o Richard Iamunno
2200 Corporate Blvd.
Suite 317
Boca Raton, FL 33431
Robert Frome 1.23 86,100 224,472 308,572
505 Park Avenue
New York, NY 10022
Robert Friedman .25 17,500 44,214 61,714
505 Park Avenue
New York, NY 10022
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Centerline 4.9 343,000 891,427 1,234,427
Associates, Inc.
Jeanne Williams
850 E. Palm Ave
Boca Raton, FL 33432
Eithne Wilmott .07 4,900 13,696 18,596
1234 S. Military
Trail, #1812
Deerfield Beach, FL
33442
Edward Cowle 2.085 145,950 379,050 525,000
708 3rd Avenue
New York, NY 10017
DeWorth Williams 2.085 145,950 379,050 525,000
56 West 440 South
Salt Lake City, UT
84101
James Dougherty 2.38 166,600 433,400 600,000
629 Sea Pineway B2
West Palm Beach, FL
33415
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Schedule 2.2
None
Schedule 2.9
None
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Schedule 2.14
1. Appointment of Transfer Agent and Agreement between CEEE Group
Corporation and Interstate Transfer Company.
Schedule 2.16
None
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