U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 25, 2001
WSN GROUP, INC.
(Exact name of registrant as specified in its charter)
Nevada
(State or jurisdiction of incorporation or organization)
0-20277
(Commission File Number)
11-2872782
(I.R.S. Employer Identification Number)
1530 Brookhollow Road, Suite C, Santa Ana, California 92705
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (714) 427-0760
(Former name or former address, if changed since last report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
(a) In a Form 8-K filed on January 12, 2001, the Registrant
reported that on November 8, 2000, the Registrant had entered into an
agreement with Delphi Communications, Inc. to purchase from this firm
the license for radio station KMET and related assets. In exchange
for these assets, the Registrant agreed to pay, under the terms of
this agreement, 7,415,254 restricted shares of the Registrant, valued
at $1,750,000.00. In addition, the Registrant agreed to assume all
liabilities of the Seller existing on the closing date. In February
2001, the Federal Communications Commission this acquisition.
On October 25, 2001, the parties agreed, by mutual consent, not
to proceed with this transaction. This decision by the Registrant
was based on the best interests of the Registrant and its shareholders.
(b) On November 13, 2001, the Registrant entered into an
agreement with Connect2Save, Inc., a Delaware Corporation, whereby
the Registrant agreed to buy from this company all of the shares of
Connect4Savings, Inc., a Delaware Corporation ("C4S"). C4S is
principally engaged in the business of long distance telephone
service and related technologies. Under the terms of this agreement,
the Registrant agreed to pay to Connect2Save, Inc. 6,500,000 shares
of restricted common stock of the Registrant in exchange for 100% of
the issued and outstanding shares of C4S, subject to an escrow.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
Financial Statements.
The Registrant has determined that this acquisition must comply
with Rule 3.05(b)(1)(iii) of Regulation S-X, and therefore financial
statements will be furnished for at least the two most recent fiscal
years and any interim periods. It is impracticable to provide the
required financial statements for this acquired business at the time
this Form 8-K is filed; these will be filed as an amendment to this
filing not later than 60 days after the filing of this report. Pro
forma financial information shall also be furnished in connection with
this acquisition pursuant to Article 11 of Regulation S-X.
Exhibits.
Exhibits included are set forth in the Exhibit Index pursuant to
Item 601 of Regulation S-B.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
WSN Group, Inc.
Dated: November 15, 2001 By: /s/ John J. Anton
John J. Anton, President
EXHIBIT INDEX
Number Exhibit Description
2 Stock Purchase Agreement between the Registrant and
Connect2Save, Inc., dated November 13, 2001 (see below).
EX-2
STOCK PURCHASE AGREEMENT
AGREEMENT, dated as of the 13th day of November, 2001 by
Connect2Save, Inc., a Delaware Corporation ("C2S") or ("Seller") and
WSN Group Inc., a Nevada Corporation ("WSN") or ("Buyer").
WITNESSETH:
WHEREAS, the Seller is the owner of all of the shares of
Connect4Savings, Inc., a Delaware Corporation ("C4S"); and
WHEREAS, Buyer is a fully reporting company, currently traded on
the OTCBB under the symbol of WSNG; and
WHEREAS, C4S is principally engaged in the business of long
distance telephone service and related technologies (the "Business");
and
WHEREAS, the Seller wishes to sell to Buyer, and Buyer wishes to
purchase from the Seller, the shares of C4S, the components, services
and know-how of the Sellers, all subject to the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of and in reliance upon the
covenants, conditions, representations and warranties herein
contained, the parties hereto hereby agree as follows:
1. Purchase and Sale Agreement.
1.1. Agreement of Purchase and Sale. Subject to the terms and
conditions set forth in this Agreement and in reliance upon the
representations, warranties, covenants and conditions herein
contained, on the Execution Date the Sellers shall sell, convey,
assign, transfer and deliver to Buyer, and Buyer shall purchase from
the Seller, the Purchased Shares, free and clear of any and all
liens, claims, charges or encumbrances of any nature whatsoever.
1.2. Purchased Shares. As used in this Agreement, the term
"Purchased Shares" means all of the shares of C4S, currently
represented by the Seller as 75,000 shares of C4S, which shall
include, through its Business, its properties and assets employed,
used or available for use in the Business, real and personal,
tangible and intangible, of every kind and nature, wherever located,
as the same shall exist on the Closing Date, including, without
limitation, all licenses, equipment, software, know-how and
capability of C4S, including the rights and interests of C4S under
warranties, guarantees, insurance policies, pending or executory
contracts and commitments for the purchase or lease of materials,
supplies or services in connection with the Business, pending or
executory contracts and commitments for the sale or lease of products
or services in connection with the Business, and other leases and
pending or executory contracts and commitments of any nature relating
to the Business; deferred charges, advance payments, prepaid expenses
and deposits; rights of offset and credits of all kinds; all other
names, brands and marks used in connection with the Business, and all
derivatives and combinations thereof; all promotional materials; all
research and development relating to the components, materials and
systems; new products, new designs, processes or cost reductions
which are used or useful or in any way related to or of potential
benefit to the Business; telephone numbers listings and rights under
governmental and administrative licenses, permits and approvals, (b)
specifications, manuals and technical data, trade secrets,
discoveries, blueprints, drawings, inventions, designs, patents,
improvements, processes, product information and data, shop rights
and know-how, and (c) all properties and assets now on hand with C4S
in the business.
1.3. Assumed Liabilities. None. The liabilities of the Business
of C4S shall remain liabilities of C4S only.
1.4. Purchase Terms.
(A) Subject to any adjustment (as defined in Subsection
2.4(c)), the purchase price for the Purchased Assets shall be represented by
the issuance of Six Million Five Hundred Thousand Shares of Common Stock of WSN
Group, Inc., in exchange for 100% of the issued and outstanding shares of C4S.
(B) The Sellers shall be granted one seat on the Board of
Directors of WSN.
(C) Upon the execution of this Agreement and completion
transfer of required amountof Shares by WSN and C2s to the Escrow
Agents, appointed in the Escrow Agreement executed on even date
herewith, C4s shall be an independent subsidiary, commonly known as
C4S, of WSN with management control remaining with existing
shareholders of C4S. Management and Control shall include the
following activities: 1) cash management; 2) accounting; 3)
execution of contracts; 4) personnel decisions; 5) election of
directors. Following the Close and until the earlier of : (1) the
delivery of C2S of all the WSN transfer shares and the issuance and
delivery to C2S of the Additional Shares or a determination that no
Additional Shares are to be issued, all as more fully set forth
hereinafter, or; (2) the written consent of C2S, the Business is to
be conducted exclusively by C4S as an independent and wholly owned
subsidiary of WSN known as the C4S Division of WSN. During such
time, the control of all aspects of C4S shall be exclusively by
persons designated by C2S which shall have, without other or further
authorization, full entire, exclusive and absolute power, control and
authority over, and management of the business assets and the affairs
of the business to the same extent as if C4S was the sole owner of
the property or business in its own right, subject only to such
limitations as may be expressly imposed by this Agreement or by
applicable law. The enumerating of specific power or authority
herein shall not be construed as limiting the aforesaid power or
authority or any specific power or authority. Without limiting the
foregoing, C4S shall have the power to make any type of investment
for the benefit of the business, to borrow money for any reasonable
purpose, to buy sell, improve, subdivide, protect, conserve, lease,
encumber and otherwise manage and dispose of the business' real and
personal property and to hypothecate by mortgage or deed of trust or
pledge, or otherwise take any measures C4S deems appropriate to
expand the capital of the business.
C4S is authorized to pay or to cause to be paid out of the
assets of the business, all expenses, fees, charges, taxes and
liabilities incurred or arising in connection with the management
hereof, including, but not limited to, such expenses and charges for
the services of the business' employees, contractors, and agents, and
such other expenses and charges as C4S may deem necessary or proper
to incur.
As an independent wholly owned subsidiary , C4S shall not be
subject to any intercorporate charges, overhead allocations or
chargeable or liable for any losses, obligations, debts or other
liabilities of WSN or other affiliates or subsidiaries.
(D) The WSN Transfer shares held in escrow will be distributed
by the Escrow Agents in accordance with the following schedule:
1) Six months after execution of this agreement, 2,000,000
shares (the Initial WSN Shares).
2) All remaining WSN shares in escrow (the Earn-Out Shares)
upon a determination made within fifteen days following
the end of each quarter upon the date of the anniversary
of the close, that any of the following conditions have
been met:
(a) the gross annualized revenues of the C4S Division
increased as follows, is greater than $5,000,000; or
(b) the annualized net income of the C4S Division
increased as follows, is greater than $300,000; or
(c) the annualized number of telecommunication
subscriber lines of the C4S Division increased as
follows, is greater than 25,000.
Each of the above measuring guidelines shall be increased by the
gross revenue, net income, or subscriber lines as the case may be, of
any company acquired in while or in part by WSN by way of merger,
consolidation or otherwise, that was referred to WSN by C2S or C4S.
The above measuring guidelines shall be determined from the regularly
prepared financial statements and reports of C4S and when applicable,
such other companies.
(E) Six months after execution of this Agreement by all
parties, 2,000,000 Shares of common stock held in escrow shall be
released by the Escrow Agent to Seller;
(F) No later than 30 days after the second anniversary date of
the execution of the agreement, WSN shall furnish C2S with audited
financial statements of C4S and WSN . Based upon the net income of
C4S including net income from those entities described in Sec, 1.4
(D), in relation to the net income of WSN as shown in said
statements, WSN shall cause to be issued to C2S so many additional
shares as follows: ) Twenty-Four months after the execution of this
Agreement, the Seller shall receive a additional shares based upon
C4S pro rata share of net income. The additional shares will raise
the Seller to 51% ownership of the outstanding WSN common stock if
C4S produces 60% of the net income of the consolidated entity. The
stock dividend will raise the Seller to 49% ownership of the
outstanding WSN common stock if C4S produces 50-59% of the net income
of the consolidated entity. The stock dividend will raise the Seller
to 30% ownership of the outstanding WSN common stock if C4S produces
30-49% of the net income of the consolidated entity. There will be
no stock dividend if C4S produces less than 30% of the net income of
the consolidated entity.
(G) The Seller will receive 50% of the benefit of any merger,
acquisition or spin-off of entities referred to WSN by C2S or C4S.
The volume of any company acquired by WSN so referred will be
included in the revenue calculations referenced in (E) above.
(H) All consideration received in a spin-off or other transfer
of the C4S Division of WSN or its assets, including but not limited
to shares of stock received thereby, shall be distributed 75% to C2S,
WSN will receive 10% of the common stock of the spun-out entity.
WSN shareholders will receive 10% of the common stock of the spun-out
entity. Marc R. Tow & Associates will receive 5% of the common stock
of the spun-out entity. In the event of a spin-off, WSN will pay all
related legal fees and costs, ensure that shareholders receive
warrants of the spun-out entity. As used in this agreement, the spin
off of the C4S Division of WSN shall mean the issuance or exchange of
C4S shares to a publicly-held company which in turn will issue its
shares in a tax favored distribution to the persons and in the
proportions noted herein. WSN agrees to utilize reasonable efforts
to achieve a spin-off of the C4S Division.
(I) All transactions contained in this Agreement shall be
conducted in an Escrow utilizing co- escrow agents. The initial
Escrow agents shall be Steve Vickery and Jack Harris. The parties
acknowledge that an Escrow Agreement is executed of even date herewith.
(J) The WSN Initial Shares and the C4S Shares shall be released
from Escrow concurrently at the time specified in 1.4(D)(1) above or
earlier upon written demand for such concurrent release by WSN.
(K) The Earn-Out Shares shall be released from escrow and
delivered to C2S in accordance with the provisions of section 1.4(D)
provided however, in the event the spin-out referred to in section
1.4(G) has not been completed and shares are distributed in
accordance therewith on or before nine (9) months after the Close,
then all earn-out shares shall be released from the Escrow and
delivered to C2S.
(L) The release of shares from escrow will be determined
periodically, but in no case less frequently than quarterly. All
determinations as to when criteria for release as set forth herein
above have been met, shall be issued by an SEC practice section
accountant as selected and approved by all parties. The dispute
resolution mechanism of section 10.14 herein shall apply in the event
of disagreement in the selection of the SEC practice section accountant.
(M) C2S shall have the right to transfer by way of assignment
or otherwise, in whole or in part, its right to receive WSN shares
under this Agreement on condition the transferee execute and deliver
an investment letter in the form set forth in section 1.5.
(N) No later than three (3) years after the Close or in the
event prior thereto WSN undertakes a public offering of its
securities through registration with the Securities and Exchange
Commission under the Securities Act of 1933, WSN shall register all
shares of common stock C2S receives or is to receive under this
Agreement including shares referred to herein as Additional Shares
Such registration of WSN shares in the case of such public offering
shall be as part of such public offering. In the case of such public
offering and to the extent WSN is required by the underwriters of
such public offering to restrict the number of pre-existing shares
that may be registered with such public offering, WSN shall only be
required to register that percentage of C2S shares of WSN in the
aggregate bears in proportion to all WSN shares issued and
outstanding at the time the registration statement for the offering
is filed.
(O) WSN agrees that upon demand of C2S on or before the Close,
the transactions contemplated by this agreement shall be construed
into a tax free reorganization in accordance with the provisions of
section 368 of the Internal Revenue Code, provided however, such
restructuring shall not materially adversely effect the rights,
benefits or obligations of WSN as set forth herein.
1.5 Investment Intent. The Seller represent and warrant that
they are acquiring the WSN Group, Inc. Shares for investment purposes only and
not with an intent to re-sell the same. The Seller shall execute
their investment letter to WSN as part of the closing of this sale.
The Seller acknowledge and understand that the WSN shares which are
being issued to them are registered securities and will bear a
standard restrictive legend, subject to the terms of Rule 144 of the
Securities Act of 1933, upon issuance. No sale or other disposition
of these shares will be allowed except upon the removal of the
restrictive legend
2. Closing
2.1. Closing Date. The closing of the sale and purchase
provided for herein (the "Closing") shall take place at 10:00 A.M.,
local time, at the offices of WSN on or before February 2, 2002, or
at such other place, time and date as may hereafter be mutually
agreed upon by the parties (such time and date of Closing being
hereinafter called the "Closing Date"). The execution date shall be
the date of execution of this Agreement.
2.2. Action by Buyer. Subject to the terms and conditions
herein contained, on the Execution date of this Agreement Buyer shall
deliver to the Escrow Agent (in addition to the documents and
instruments to be delivered by it pursuant to Articles 3 and 9
hereof):
(a) delivery of six million five hundred thousand
(6,500,000) shares of restricted common capital stock of WSN ;
2.3. Action by the Sellers. Subject to the terms and conditions
herein contained, on the Closing Date the Sellers, shall deliver to
Escrow Agents (in addition to the documents and instruments to be
delivered by it pursuant to Articles 3 and 8 hereof):
(a) a duly executed stock power, signature guaranteed
representing all shares and ownership interests in C4S;
(b) all such warranties and licenses necessary to operate
the equipment and software as of the execution date;
(c) all third party consents and governmental and
administrative approvals, as shall be, in the opinion of Buyer,
necessary or appropriate in order to convey, transfer and assign
to and vest in Buyer good and marketable right, title and
interest in and to the Purchased Shares, free and clear of all
liens, security interests, claims, charges and encumbrances of
any nature whatsoever.
3. Additional Covenants.
3.1. Further Assurances. The Seller and Buyer hereby agree
that it shall from time to time after the Closing Date, at its sole
cost and expense, take any and all actions, and execute, acknowledge,
deliver, file and/ or record any and all documents and instruments,
as any other party may reasonably request in order to more fully
perfect the rights which are intended to be granted to such party hereunder.
3.2. Non-Assignable Contracts. Anything in this Agreement
contained to the contrary notwithstanding, nothing in this Agreement
shall be construed as an attempt to assign (a) any contract or
agreement that is at law non-assignable without the consent of the
other party thereto and as to which such consent shall not have been
given, or (b) any contract or agreement as to which all the remedies
for the enforcement thereof and the rights thereunder enjoyed by the
Seller would not, as a matter of law, pass to Buyer as an incident of
the assignments provided for by this Agreement. In order, however,
that the full value of every contract and agreement of the character
described in clauses (a) and (b) of the immediately preceding
sentence and all claims and demands relating to such contracts and
agreements may be realized, the Seller hereby agree with Buyer that
they will, at their sole cost and expense, at the request and under
the direction of Buyer, in the name of the Seller or otherwise, as
Buyer shall specify and as shall be permitted by law, take all such
action and do or cause to be done all such things as shall be, in the
opinion of Buyer, necessary or desirable (i) in order that the rights
and benefits of the Seller under such contracts and agreements shall
be preserved and (ii) for, and to facilitate, the collection of the
monies, services or warranties due and payable, and to become due and
payable, to the Seller in and under every such contract and
agreement, and the Seller will hold the same for the benefit of and
will pay the same, when received, to Buyer.
3.3. Investigation. Between the date hereof and the Closing
Date Buyer and Seller may, directly and through its representatives,
make such investigation of the Business of the other and the
Purchased Shares and underlying Assets as each deems necessary or
advisable, but such investigation shall not affect any of the
representations and warranties of the Seller or Buyer contained
herein or in any instrument or document delivered pursuant hereto. In
furtherance of the foregoing, each party and party's representatives
shall have, at all reasonable times after the date hereof, full
access to the premises and to the books and records of the Business
of the other , and the each party shall furnish to the other and its
representatives such contracts, purchase orders, invoices, financial
and operating data and other information with respect to the Business
and the underlying Purchased Assets as each party may from time to
time reasonably request. Each party shall use its reasonable efforts
not to disclose or use any confidential information that it obtains
in connection with the foregoing, except to the extent which it deems
to be necessary in order to evaluate the Business. In the event that
the purchase and sale transaction provided for herein is not
consummated for any reason whatsoever, each party shall return to
the other all documents, workpapers and other written materials which
were obtained by it during the course of such investigation which
constitute confidential information.
3.4. Consummation of Transaction. Each of the parties hereto
hereby agrees to use his or its best efforts to cause all conditions
precedent to his or its obligations and to the obligations of the
other parties hereto to consummate the transactions contemplated
hereby to be satisfied, including, but not limited to, using his or
its best efforts to obtain all required consents, waivers,
amendments, modifications, approvals, authorizations, novations and
licenses; provided, however, that nothing herein contained shall be
deemed to modify any of the obligations imposed upon any of the
parties hereto under this Agreement or any agreement executed and
delivered pursuant hereto.
3.5. Cooperation. Each of the parties hereto hereby agrees to
fully cooperate with the other parties hereto in preparing and filing
any notices, applications, reports and other instruments and
documents which are required by, or which are desirable in the
opinion of any of the parties hereto in respect of, any statute,
rule, regulation or order of any governmental or administrative body
in connection with the transactions contemplated hereby.
3.6. Accuracy of Representations. Each party hereto agrees that
prior to the Closing Date he or it will enter into no transaction and
take no action, and will use his or its best efforts to prevent the
occurrence of any event, which would. result in any of his or its
representations, warranties or covenants contained in this Agreement
or in any agreement, document or instrument delivered pursuant hereto
not to be true and correct, or not to be performed as contemplated,
at and as of the time immediately after the occurrence of such
transaction or event.
3.7. Conduct of Business. Sellers covenant and agree to use
their best efforts to cause C4S to conduct its and their Business
operations during the period from the date hereof to the Closing Date
only in the ordinary course of business and in a manner consistent
with the equipment lists and criteria previously provided to Buyer
and in compliance with applicable laws, except pursuant to the terms hereof
3.8. Use of Names. At the Closing C4S and the Sellers take such
other action as is necessary or is in the opinion of Buyer desirable
so that Buyer will have full and exclusive right, title and interest
in and to, and exclusive use of, all of the names, brands and marks
used in connection with the Business, including, without limitation,
the names "Connect2Save" or "Connect4Savings". In furtherance of the
foregoing, the Seller hereby agree from and after the Closing Date
they shall not use or permit any of their companies or affiliates to
use, directly or indirectly, any of such words, names, brands, marks
or expressions, or anything so closely resembling any of the
foregoing as to be likely confused therewith, or as to be likely to
detract from the value of any of the underlying Purchased Assets or
the Business.
3.10. Payment of Taxes Upon Transfer of Purchased Assets.
The Seller shall be responsible for, and shall pay, any and all
sales, use, purchase, transfer and similar taxes (real estate or
otherwise), and any and all filing, recording, registration and
similar fees, arising out of the transactions contemplated by this
Agreement.
3.11. Survival of Representations and Warranties. Each of
the parties hereto hereby agrees that all representations and
warranties made by or on behalf of him or it in this Agreement or in
any document or instrument delivered pursuant hereto shall survive
for a period of three (3) years following the Closing Date and the
consummation of the transactions contemplated hereby, except with
respect to the representation and warranties set forth in Sections 4
which shall survive for the applicable statute of limitation periods.
3.12. Books and Records. The Seller shall, for a period of
at least seven (7) years following the Closing Date, maintain and
make available to Buyer and its representatives for inspection and
reproduction, during regular business hours, all books and records
relating to the Purchased Assets, and the Business. Buyer shall, for
a period of at least seven (7) years following the Closing Date,
maintain and make available to the Seller and their representatives
for inspection and reproduction, during regular business hours, all
books and records relating to the underlying Purchased Assets, the
Business, but only insofar as said books and records relate to
periods ending on or prior to the Closing Date.
3.13. Discharge of Liens. The Seller shall cause all liens,
claims, charges and encumbrances upon any of the Purchased Shares to
be terminated or otherwise discharged at or prior to the Closing.
3.14. Products Liability Insurance. On or prior to the
Closing Date, C2S and C4S shall, at its expense, cause Buyer to be named as
an additional insured under such products liability insurance policies as in
effect on the Closing Date, if any. The Seller shall provide Buyer with a copy
of said policies at the Closing, together with the written agreements of
the insurers that said policies will not be modified or canceled
without at least 30 day's prior written notice to Buyer.
3.15 Quarterly Financial Statements. Commencing as of the
execution of this Agreement, C4S shall provide quarterly unaudited
financial statements to WSN within fifteen (15) days of the end of
each quarter. Said obligation shall continue so long as C4S remains
a part of the consolidated entity.
4. Representations and Warranties as to Each Selling Individual and
the Seller. Each of the Seller jointly and severally represent and
warrant to Buyer as follows:
4.1. Ownership and Power. The Seller own the shares of C4S
without limitation, lien or restriction thereon. There are no
options, rights, or other claims or rights to ownership of C4S shares
except as disclosed on Exhibit 4.1 hereto. C2S has full power and
authority to own, lease and operate the underlying purchased assets,
the business and to carry on its business as presently contemplated
and as provided in the marketplace. There are no states or
jurisdictions in which the character and location of any of the
equipment or properties owned or leased by C4S, or the conduct of its
business, makes it necessary for it to qualify to do business as a
foreign corporation.
4.2. Fair Market Value. The consideration exchanged herein is
adequate. All shares being sold to Buyer herein hereto have been
duly and validly purchased and are fully paid for with no claim or
lien or set-off.
4.3. Authority. The execution and delivery by the Seller of
this Agreement and of all of the agreements to be executed and
delivered by them pursuant hereto, the performance by them of their
obligations hereunder and thereunder, and the consummation of the
transactions contemplated hereby and thereby, have been duly and
validly authorized by all necessary action on the part of the Seller,
and the Seller have all necessary power with respect thereto. This
Agreement is, and when executed and delivered by the Selling
Individual and the Seller (to the extent that they are parties
thereto) each of the other agreements to be delivered by any or all
of them pursuant hereto will be, the valid and binding obligation of
the Selling Individual and the Seller (to the extent that they are
parties thereto) in accordance with its terms.
4.4. Non-contravention. Except as set forth on Schedule 4.4
neither the execution and delivery by any Selling Shareholder or any
of the Seller of this Agreement or of any agreement to be executed
and delivered by any or all of them pursuant hereto, nor the
consummation of any of the transactions contemplated hereby or
thereby, nor the performance by any of them of any of their
respective obligations hereunder or thereunder, will (nor with the
giving of notice or the lapse of time or both would) (a) conflict
with or result in a breach of any provision of any Agreements or
Licenses of the Seller, or (b) give rise to a default, or any right
of termination, cancellation or acceleration, or otherwise be in
conflict with or result in a loss of contractual benefits to any of
them, under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, agreement or other instrument or
obligation to which any of them is a party or by which any of them
may be bound, or require any consent, approval or notice under the
terms of any such document or instrument, or (c) violate any order,
writ, injunction, decree, law, statute, rule or regulation of any
court or governmental or administrative authority which is applicable
to any of them, or (d) result in the creation or imposition of any
lien, claim, security interest restriction, charge or encumbrance
upon any of the Purchased Shares, or (e) interfere with or otherwise
adversely affect the ability of Buyer to carry on the Business after
the Closing Date on substantially the same basis as is now
contemplated by the Seller.
4.5. Absence of Undisclosed Liabilities. C4S and the Seller
have no liabilities or obligations of any nature whatsoever, whether
accrued, absolute, contingent or otherwise, which have not been (a)
in the case of liabilities and obligations of a type customarily
reflected on a balance sheet prepared in accordance with GAAP, or (b)
in the case of other types of liabilities and obligations, described
in any of the Schedules delivered pursuant hereto or omitted from
said Schedules in accordance with the terms of this Agreement.
4.6. Shares and Underlying Assets. The Purchased Shares and the
Assets of C4S comprise all of the assets which are necessary in order
for Buyer to carry on the proposed Business after the Closing Date on
substantially the same basis as is now contemplated by the Seller and
as represented to the Buyer. The Seller have good and valid title to
all of the Purchased Shares, free and clear of all mortgages, liens,
pledges, charges or encumbrances of any nature whatsoever and C4S has
good and valid title to all of its Assets. All equipment and software
which are material to the business, operation or condition (financial
or otherwise) of C4S are in good operating condition and repair, and
are suitable for the purposes for which they are used; and none of
such equipment, software or systems, when built, will require any
specialized repairs except for ordinary, routine maintenance and
repairs which are not substantial in nature or cost. C4S shall
provide a list of the Purchased assets and shall be attached as
Exhibit 4.6 hereto. No personal property items currently utilized by
employees of C4S to perform duties shall be included in the
Purchased Assets.
4.7. Litigation. Other than as set forth in Schedule 4.7 there
are no claims, suits, actions, arbitration, investigations, inquiry
or other proceeding before any governmental agency, court or
tribunal, domestic or foreign, or before any private arbitration
tribunal, pending or, to the best of the knowledge of the Seller,
threatened, against or relating to the Seller, the-Business or any of
the Purchased Assets; nor, is there any basis for any such claim,
suit, action, arbitration, investigation, inquiry or other
proceeding. There are no judgments, orders, stipulations,
injunctions, decrees or awards in effect which relate to the Seller,
the Business or any of the Purchased Assets, the effect of which is
(a) to limit, restrict, regulate, enjoin or prohibit any business
practice in any area, or the acquisition of any properties, assets or
businesses, or (b) otherwise materially adverse to the Business or
any of the Purchased Shares or underlying Assets.
4.8. No Violation of Law. The Seller are not engaging in any
activity or omitting to take any action as a result of which (a) it
is in violation of any law, rule, regulation, zoning or other
ordinance, statute, order, injunction or decree, or any other
requirement of any court or governmental or administrative body or
agency, applicable to the Seller, the Business or any of the
Purchased Shares or Assets, including, but not limited to, those
relating to: occupational safety and health; environmental and
ecological protection (e.g., the use, storage, handling, transport or
disposal of pollutants, contaminants or hazardous or toxic materials
or wastes, and the exposure of persons thereto); business practices
and operations; labor practices; employee benefits; and zoning and
other land use, and (b) the Seller, the Business and/ or any of the
Purchased Assets have been or may be materially and adversely affected.
4.9. Intellectual Property. Schedule 4.9 is a complete and
correct list of all (a) United States and foreign patents, trademark
and trade name registrations, trademarks and trade names, brand marks
and brand name registrations, service-marks and serviceman
registrations, assumed names and copyrights and copyright
registrations, owned in whole or in part or used by C4S and/ or the
Seller for use through C4S, and all applications therefore, (b)
inventions, discoveries, improvements, processes, formulae,
proprietary rights and trade secrets relating to the Business, and
(c) licenses and other agreements to which the Seller is a party or
otherwise bound which relate to any of the foregoing. Except as
expressly set forth in said Schedule 4.9 (a) the Seller owns or has
the right to use all of the foregoing; (b) no proceedings have been
instituted, are pending or, to the best of the knowledge of the
Seller are threatened, which challenge the rights of the Seller in
respect thereto or the validity thereof and, to the best knowledge of
the Seller, there is no valid basis for any such proceedings; (c)
none of the aforesaid violates any laws, statutes, ordinances or
regulations, or has at any time infringed upon or violated any rights
of others, or is being infringed by others; and (d) none of the
aforesaid is subject to any outstanding order, decree, judgment,
stipulation or charge.
4.10. Tax Matters. The Seller have filed with the
appropriate governmental agencies all tax returns and reports
required to be filed by them, and have paid in full or made adequate
provision for the payment of, all taxes, interest, penalties,
assessments and deficiencies shown to be due or claimed to be due on
such tax returns and reports. The United States federal income tax
returns of the C4S have not been examined by the Internal Revenue
Service (the "IRS").
4.11 Insurance. Attached hereto as Schedule 4.11 is a complete
and correct list and summary description of all policies of insurance
relating to any of the underlying Purchased Assets or the Business in
which the Seller are an insured party, beneficiary or loss payable
payee. Such policies are in full force and effect, all premiums due
and payable with respect thereto have been paid, and no notice of
cancellation or termination has been received by the Seller with
respect to any such policy. In the opinion of the Seller, such
policies cover risks normally insured against, and are in amounts
normally carried, by companies engaged in similar businesses. The
Seller has not sustained any material loss or interference with their
business from fire, storm, explosion, flood or other casualty,
whether or not covered by insurance, or from any labor dispute or
court of governmental action, order or decree.
4.12 Employee Arrangements.
(a) Schedule 4.12 is a complete and correct list and
summary description of all (i) union, collective bargaining,
employment, management, termination and consulting agreements to
which the Seller is a party or otherwise bound, and (ii)
compensation plans and arrangements; bonus and incentive plans
and arrangements; deferred compensation plans and arrangements;
pension and retirement plans and arrangements; profit-sharing
and thrift plans and arrangements; stock purchase and stock
option plans and arrangements; hospitalization and other life,
health or disability insurance or reimbursement programs;
holiday, sick leave, severance, vacation, tuition reimbursement,
personal loan and product purchase discount policies and
arrangements; and other plans or arrangements providing for
benefits for employees of the Seller. Said Schedule also lists
the names and compensation of all employees of the Seller whose
earnings during the last fiscal year was $25,000 or more
(including bonuses and other incentive compensation), and all
employees who are expected to receive at least said amount in
respect of the present year.
(b) Schedule 4.12 also sets forth all outstanding loans
and other advances (other than travel advances in the ordinary
course of business which do not exceed $1,000 per individual)
made by the Seller to any of its officers, directors, employees,
Shareholders, partners or consultants.
4.13. Certain Business Matters. Except as is set forth in
Schedule 4.13 (a) neither C2S and C4S nor the Seller is/ are not a
party to or bound by any distributorship, dealership, sales agency,
franchise or similar agreement which relates to the sale or
distribution of any of the products and services of the Business, (b)
the product and service warranties given by the Company or by which
they are bound (complete and correct copies or descriptions of which
are set forth on Schedule 4.13, entail no greater obligations than
are customary in the business of the Company, (c) the Company is not
a party to or bound by any agreement which limits its freedom to
compete in any line of business or with any person, or which is
otherwise materially burdensome to it, and (d),C4S is not a party to
or bound by any agreement in which (or any affiliate of any such
person) has, or had when made, a direct or indirect material interest.
4.14. Certain Contracts. Schedule 4.14 is a complete and
correct list of all contracts, commitments, indentures, mortgages,
obligations, agreements and understandings which are not set forth in
any other Schedule delivered hereunder and to which C4S is a party or
otherwise bound, except for each of those which (a) was made in the
ordinary course of business, and (b) either (i) is terminable by C4S
(and will be terminable by Buyer) without liability, expense or other
obligation on 30 days, notice or less, or (ii) may be anticipated to
involve aggregate payments to or by C4S of $10,000 (or the
equivalent) or less calculated over the full term thereof, and (c) is
not otherwise material to the Business or any of the underlying
Purchased Assets. Complete and correct copies of all contracts,
commitments, indentures, mortgages, obligations, agreements and
undertakings set forth on any of the Schedules delivered pursuant to
this Agreement have been furnished by C4S to Buyer, and except as
expressly stated on the Schedule on which they are set forth, (a)
each of them is in full force and effect, no person or entity which
is a party thereto or otherwise bound thereby is in default
thereunder, and no event, occurrence, condition or act exists which
does (or which with the giving of notice or the lapse of time or both
would) give rise to a default or right of cancellation, acceleration
or loss of contractual benefits thereunder; (b) there has been no
threatened cancellations thereof, and there are no outstanding
disputes thereunder; and (c) none of them is materially burdensome to
the Company. None of the material provisions of such contracts,
instruments or agreements violates any existing applicable law, rule,
regulation, judgment, order or decree of any governmental agency or
court having jurisdiction over the Business or the underlying
Purchased Assets.
4.15. Approvals. Schedule 4.15 is a complete and correct
list of all governmental, administrative and third-party consents,
permits, appointments, approvals, licenses, certificates, franchises
and other authorizations which, are necessary for the operation of
the Business or to own or operate C4S and the underlying Purchased
Assets, all of which have been obtained by C4S and/ or the Seller and
are in full force and effect. There are no proceedings pending or, to
the best of the Seller' knowledge, threatened, or any basis
therefore, seeking to cancel, terminate or limit such consents,
permits, appointments, approvals, licenses, certificates, franchises
or other authorizations.
4.16. Information as to the Seller. None of the
representations or warranties made by the Seller or any of the Seller
in this Agreement or in any agreement executed and delivered by or on
behalf of any of them pursuant hereto are false or misleading with
respect to any material fact, or omit to state any material fact
necessary in order to make the statements therein contained not misleading.
5. Representations and Warranties as to Buyer. WSN represents and
warrants to the Seller as follows:
5.1. Organization. Standing and Power. WSN is a Nevada
Corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada, with full corporate power and
authority to own, lease and operate its properties and to carry on
its business as presently conducted by it. As of January 1, 2000, WSN
has 500,000,000 common shares authorized with a par value of $0.001
per share, of which approximately 35,000,000 are issued and
outstanding. All shares are fully paid and non-assessable.
5.2 Authority. The execution and delivery by WSN of this
Agreement and of each agreement to be executed and delivered by it
pursuant hereto, the compliance by WSN with the provisions hereof and
thereof, and the consummation of the transactions contemplated hereby
and thereby, have been duly and validly authorized by all necessary
corporate action on the part of WSN and WSN has all necessary
corporate power with respect thereto. This Agreement is, and when
executed and delivered by WSN each other agreement to be executed and
delivered by either or both of them pursuant hereto will be, the
valid and binding obligation of WSN, as applicable, in accordance
with its terms. Neither the execution and delivery by WSN of this
Agreement or of any of the aforementioned other agreements, nor the
consummation of the transactions contemplated hereby or thereby, nor
the compliance by WSN with the provisions hereof and thereof, will
(nor with the giving of notice or the lapse of time or both, would)
conflict with or result in a violation of any provision of the
Certificates of Incorporation or By-laws of either WSN, or in the
breach of any material agreement to which WSN is a party or otherwise bound.
5.3 Fair Market Value. The consideration exchanged
herein is adequate and is the fair market value for the assets purchased
herein.
5.4 Litigation. Other than as set forth in Schedule 5.4 there
are no claims, suits, actions, arbitration, investigations, inquiry or other
proceeding before any governmental agency, court or tribunal, domestic or
foreign, or before any private arbitration tribunal, pending or, to
the best of the knowledge of the Buyers, threatened, against or
relating to the Buyers, the-Business ; nor, is there any basis for
any such claim, suit, action, arbitration, investigation, inquiry or
other proceeding. There are no judgments, orders, stipulations,
injunctions, decrees or awards in effect which relate to the Buyers
Business , the effect of which is (a) to limit, restrict, regulate,
enjoin or prohibit any business practice in any area, or the
acquisition of any properties, assets or businesses, or (b) otherwise
materially adverse to the Business or underlying Assets.
5.5 No Violation of Law. The Buyers are not engaging in any
activity or omitting to take any action as a result of which (a) it
is in violation of any law, rule, regulation, zoning or other
ordinance, statute, order, injunction or decree, or any other
requirement of any court or governmental or administrative body or
agency, applicable to the Buyers, including, but not limited to,
those relating to: occupational safety and health; environmental and
ecological protection (e.g., the use, storage, handling, transport or
disposal of pollutants, contaminants or hazardous or toxic materials
or wastes, and the exposure of persons thereto); business practices
and operations; labor practices; employee benefits; and zoning and
other land use.
5.6 Approvals. Schedule 5.6 is a complete and correct list of
all governmental, administrative and third-party consents, permits,
appointments, approvals, licenses, certificates, franchises and other
authorizations which, are necessary for the operation of the Business
or to own or operate WSN, all of which have been obtained by Buyer
and are in full force and effect. There are no proceedings pending
or, to the best of the Buyer's knowledge, threatened, or any basis
therefore, seeking to cancel, terminate or limit such consents,
permits, appointments, approvals, licenses, certificates, franchises
or other authorizations.
6. Indemnification.
6.1. Indemnification by the Seller and the Selling Stockholders.
The Seller and each Selling Stockholders, jointly and severally,
indemnify and hold WSN harmless from and against any and all losses,
obligations, deficiencies, liabilities, claims, damages, costs and
expenses including, without limitation, the amount of any settlement
entered into pursuant hereto, and all reasonable legal and other
expenses incurred in connection with the investigation, prosecution
or defense of any matter indemnified pursuant hereto (a "Loss") which
Loss WSN and/or Buyer may sustain, suffer or incur and which arise
out of, are caused by, relate to, or result or occur from or in
connection with (a) liabilities other than the Assumed Liabilities,
(b) the noncompliance with any applicable bulk transfer laws of any
jurisdiction, or (c) the breach by the Seller or any of the Seller of
any representation, warranty or covenant made by him or it in this
Agreement or in any agreement or instrument executed and delivered
pursuant hereto. This indemnification obligation shall also apply to
claims directly by WSN against the Seller and/ or the Selling
Stockholders as well as to third party claims.
6.2. Indemnification by Buyer. Buyer indemnities and holds the
Seller and the Seller harmless from and against any Loss, which Loss
any of them may sustain, suffer or incur and which arise out of, are
caused by, relate to, or result or occur from or in connection with
(a) the Assumed Liabilities or (b) the breach by Buyer of any
representation, warranty or covenant made by it in this Agreement or
in any agreement or instrument executed and delivered pursuant
hereto. This indemnification obligation shall also apply to claims
directly by the Seller and/ or the Seller against Buyer as well as to
third party claims.
6.3. Third Party Claims. If a claim by a third party is made
against any party or parties hereto and the party or parties against
whom said claim is made intends to seek indemnification with respect
thereto under this Article 6, the party or parties seeking such
indemnification shall promptly notify the indemnifying party or
parties, in writing, of such claim; provided, however, that the
failure to give such notice shall not affect the rights of the
indemnified party or parties hereunder unless such failure materially
and adversely affects the indemnifying party or parties. The
indemnifying party or parties shall have ten days after said notice
is given to elect, by written notice given to the indemnified party
or parties, to undertake, conduct and control, through counsel of
their own choosing (subject to the consent of the indemnified party
or parties, such consent not to be unreasonably withheld) and at
their sole risk and expense, the good faith settlement or defense of
such claim, and the indemnified party or parties shall cooperate
with-the indemnifying parties in connection therewith; provided: (i)
in the case of the Seller and/ or any of the Seller as the
indemnifying party or parties, it or they shall not thereby permit to
exist any lien, encumbrance or other adverse change upon any of the
Purchased Assets, Buyer or the Business, and (ii) the indemnified
party or parties shall be entitled to participate in such settlement
or defense through counsel chosen by the indemnified party or
parties, provided that the fees and expenses of such counsel shall be
borne by the indemnified party or parties. So long as the
indemnifying party or parties are contesting any such claim in good
faith, the indemnified party or parties shall not pay or settle any
such claim; provided, however, that notwithstanding the foregoing,
the indemnified party or parties shall have the right to pay or
settle any such claim at any time, provided that in such event they
shall waive any right of indemnification therefore by the
indemnifying party or parties, If the indemnifying parties do not
make a timely election to undertake the good faith defense or
settlement of the claim as aforesaid, or if the indemnifying parties
fail to proceed with the good faith defense or settlement of the
matter after making such election, then, in either such event, the
indemnified party or parties shall have the right to contest, settle
or compromise the claim at their exclusive discretion, at the risk
and expense of the indemnifying parties to the full extent set forth
in Sections 6.1 or 6.2 hereof, as the case may be.
7. Non-disclosure; Non-compete.
7.1. "Confidential Information" Defined. As used in this
Article 7, the term "Confidential Information" shall mean any and all
information (oral and written) relating to the Business or the
Purchased Assets, other than such information which can be shown by
the Seller to be in the public domain (such information not being
deemed to be in the public domain merely because it is embraced by
more general information which is in the public domain) other than as
the result of a breach of the provisions of Section 7.2 below,
including, but not limited to, information relating to: identity and
description of goods and services used; purchasing; costs; pricing;
machinery and equipment; manufacturing processes; technology;
research; test procedures and results; customers and prospects;
marketing; and selling and servicing.
7.2. Non-disclosure of Confidential Information. The
parties hereby agrees not to, at any time, directly or indirectly,
use, communicate, disclose or disseminate any Confidential
Information in any manner whatsoever.
7.3. Non-compete Covenant. Except as otherwise provided in
the Employment Agreements, the parties shall not, during the six
month period commencing on the Closing Date, directly or indirectly,
within any county (or adjacent counties) in any state or Canadian
province in which C4S or WSN is engaged in the Business, (a) engage
or become interested in any entity (whether as owner, manager,
operator, licensor, licensee, lender, partner, stockholder, joint
venturer, employee, consultant or otherwise) sells, distributes or
otherwise deals with any products (or similar or competitive
products) which are currently or at the expiration of the six month
period are manufactured, sold, distributed or otherwise dealt with by
C4S or WSN, or (b) take any other action which constitutes an
interference with or a disruption of Buyer's operation of the
Business or Buyer's use, ownership and enjoyment of the Business of
C4S or WSN including, without limitation, the solicitations of C4S
or WSN's customers, [Notwithstanding the foregoing, the Seller and
each Selling Stockholder shall be permitted to own not more than 10%
of any class of securities which is registered under the Securities
Exchange Act of 1934, as amended; provided, however, that said
limitation shall apply to the aggregate holdings of any Selling
Stockholder or the Seller, as the case may be, and those of all other
persons and entities with whom he or it has agreed to act for the
purpose of acquiring, holding, voting or disposing of such
securities.] Further, such limitation shall not apply to Harsh
Development LLC in any manner.
For purposes of clarification, but not of limitation, the Seller and
each of the Seller hereby acknowledges and agrees that the provisions
of this Section 7.3 shall serve as a prohibition against him or it,
during the period described therein, directly or indirectly, hiring,
offering to hire, enticing away or in any other manner persuading or
attempting to persuade any officer, employee, agent, lessor, lessee,
licensor, licensee, customer, prospective customer or supplier of the
Business to discontinue or alter his or its relationship with the Business.
7.4. Injunctive Relief. etc. The parties hereto hereby
acknowledge and agree that (a) Buyer and WSN would be irreparably
injured in the event of a breach by the Selling Individual or any of
the Seller of any of his or its obligations under this Article 7 with
respect to unauthorized disclosure of Confidential Information or
engaging in activities in violation of Section 7.3, (b) monetary
damages would not be an adequate remedy for any such breach, and (c)
Buyer shall be entitled to injunctive relief, in addition to any
other remedy which it may have, in the event of any such breach. It
is hereby also agreed that the existence of any claims which the
Seller or any of the Seller may have against Buyer, whether under
this Agreement or otherwise, shall not be a defense to the
enforcement by Buyer of any of its rights under this Article 7.
7.5. Scope of Restriction. It is the intent of the parties
hereto that the covenants contained in this Article 7 shall be
enforced to the fullest extent permissible under the laws of and
public policies of each jurisdiction in which enforcement is sought
(the Seller and the Seller hereby acknowledging that said
restrictions are reasonably necessary for the protection of Buyer).
Accordingly, it is hereby agreed that if anyone or more of the
provisions of this Article 7 shall be adjudicated to be invalid or
unenforceable for any reason whatsoever, said provision shall be
(only with respect to the operation thereof in the particular
jurisdiction in which such adjudication is made) construed by
limiting and reducing it so as to be enforceable to the extent permissible.
7.6. Additional Undertakings. The provisions of this
Article 7 shall be in addition to, and not in lieu of, any other
obligations with respect to the subject matter hereof, whether
arising as a matter of contract, by law or otherwise, including, but
not limited to, any obligations which may be contained in any
employment or consulting agreements between Buyer and any of the Seller.
(a) Conditions Subsequent, Right of WSN to Abandon. WSN
shall have the right to terminate this Agreement and abandon the
transactions contemplated hereby, returning all parties to the
same positions that existed prior to the execution of this
Agreement, in the event that any of the following shall not be
true or shall not have occurred, as the case may be, as of the
Closing Date: final financial audit of C4S and the underlying
Purchased Assets delivered to WSN.
I have read and agree to the preceding paragraph.
______ ______
RA JA
8.1. Accuracy of Representations and Warranties. The
representations and warranties of the Seller and the Seller contained
in this Agreement or in any document, agreement or instrument
delivered by any or all of them pursuant hereto shall have been true
when made, and, in addition, shall be true on and as of the Closing
Date with the same force and effect as though made on and as of the
Closing Date.
8.2. Performance of Agreements. The Seller and the Seller shall
have performed all obligations and agreements, and complied with all
covenants and conditions, contained in this Agreement or in any
document, agreement or instrument delivered by any or all of them
pursuant hereto and required to be performed or complied with by any
or all of them at or prior to the Closing Date.
8.3. Certificate. The Selling Individual and the Seller shall
have each furnished Buyer with a certificate or certificates
(executed, on behalf of the Seller, by its President), dated the
Closing Date, to the effect that he or it has fulfilled the
conditions specified in Sections 8.1 and 8.2 above.
8.4. Litigation. No order of any court or administrative agency
shall be in effect which restrains or prohibits the transactions
contemplated hereby, and no suit, action, inquiry, investigation or
proceeding in which it will be, or it is, sought to restrain,
prohibit or change the terms of or obtain damages or other relief in
connection with this Agreement or any of the transactions
contemplated hereby, and which in the judgment of Buyer or WSN makes
it inadvisable to proceed with the consummation of such transactions,
shall have been instituted or threatened by any person or entity.
8.6. Consents and Approvals. All consents, waivers, approvals,
licenses and authorizations by third parties and governmental and
administrative authorities (and all amendments or modifications to
existing agreements with third parties) required as a precondition to
the performance by the Seller of their respective obligations
hereunder and under any agreement delivered pursuant hereto,
including, without limitation, the consent of Landlord, or which in
Buyer's judgment are necessary to continue unimpaired any rights in
and to the Purchased Assets which could be impaired by the purchase
and sale hereunder, shall have been duly obtained and shall be in
full force and effect.
8.7. Validity of Transactions. The validity of all transactions
contemplated hereby, as well as the form and substance of all
agreements, instruments, opinions, certificates and other documents
delivered by the Seller and the Seller pursuant hereto, shall be
satisfactory in all material respects to WSN and its counsel.
8.9. Board Authorization. The approval of this Agreement and
all of the transactions contemplated hereby by the Board of Directors
of Buyer.
8.10. Due Diligence. Buyer being satisfied that the results
of its "due diligence" investigation (as contemplated in Section 3.3
hereof) of the Seller' business, liabilities, properties and assets
are materially consistent with all of the data, statistics, financial
statements, representations, assurances and other information,
financial and otherwise relating to the C4S's business liabilities,
properties and assets provided to Buyer by the Seller and/or the
Seller, either orally or in writing, prior to the date of this Agreement.
8.11. Audit of C4S. Buyers' expert and accountants shall
have commenced their financial audit of C2S and C4S and the
underlying Purchased Assets.
8.13. No Material Adverse Changes. Except as otherwise
permitted by this Agreement, there shall not have occurred after the
date hereof, in the reasonable judgment of Buyer, a material adverse
change in the condition or capability of C4S, the underlying
Purchased Assets or the Business.
9. Right of the Seller to Abandon. The Seller shall have the right
to terminate this Agreement and abandon the transactions contemplated
hereby in the event that any of the following shall not be true or
shall not have occurred, as the case may be, as of the Closing Date:
9.1. Accuracy of Representations and Warranties. The
representations and warranties of WSN contained in this Agreement or in any
document, agreement or instrument delivered by it pursuant hereto shall have
been true when made, and, in addition, shall be true on and as of the Closing
Date with the same force and effect as though made on and as of the
Closing Date.
9.2. Performance of Agreements. WSN shall have performed all
obligations and agreements, and complied with all covenants and conditions,
contained in this Agreement or in any document, agreement or instrument
delivered by it pursuant hereto and required to be performed or
complied with by it at or prior to the Closing Date.
9.3. Certificate. Buyer shall have furnished the Seller with a
certificate, executed by a responsible executive officer of Buyer,
dated the Closing Date, to the effect that it has fulfilled the
conditions specified in Sections 9.1 and 9.2 hereof.
9.4. Litigation. No order of any court or administrative agency
shall be in effect which restrains or prohibits the transactions
contemplated hereby, and no suit, action, inquiry, investigation or
proceeding in which it will be, or it is, sought to restrain,
prohibit or change the terms of or obtain damages or other relief in
connection with this Agreement or any of the transactions
contemplated hereby, and which in the judgment of Seller makes it
inadvisable to proceed with the consummation of such transactions,
shall have been instituted or threatened by any person or entity.
9.5. Consents and Approvals. All consents, waivers, approvals,
licenses and authorizations by third parties and governmental and
administrative authorities (and all amendments and modifications to
existing agreements with third parties) required as a precondition to
the performance by the Buyer of its obligations hereunder shall have
been duly obtained and shall be in full force and effect.
9.7 No Material Adverse Changes. Except as otherwise
permitted by this Agreement, there shall not have occurred after the
date hereof, in the reasonable judgment of Seller, a material adverse
change in the condition or capability of WSN.
10. Miscellaneous Provisions.
10.1. Effect of Abandonment. In the event that this
Agreement is terminated and the transactions contemplated hereby are
abandoned pursuant to the terms hereof, this Agreement shall
forthwith become wholly void and of no force and effect, except as to
the last two sentences of Section 3.3 hereof and Section 10.2 hereof;
provided, however, that nothing in this Agreement contained shall be
deemed to relieve any party hereto from liability for any breach of
this Agreement prior to termination.
10.2. Expenses. WSN will pay upon closing, all expenses
arising from this Agreement Except as otherwise provided in this
Agreement, each of the parties hereto shall pay his or its own costs
and expenses in connection with this Agreement and the transactions
contemplated hereby. For purposes of this Agreement, the expenses of
the Seller shall be deemed to be the expenses of the Seller.
10.3. Execution in Counterparts. This Agreement may be
executed in one or more counterparts, and by the different parties
hereto in separate counterparts, each of which shall be deemed to be
an original but all of which taken together shall constitute one and
the same agreement, and shall become effective when one or more
counterparts has been signed by each of the parties hereto and
delivered to each of the other parties hereto.
10.4. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to
have been duly given or made as of the date delivered, if delivered
personally, or one (1) business day after having been deposited with
courier, if sent by overnight courier or having been sent by
telecopy, if sent by telecopy (receipt confirmed), or three (3)
business days after having been mailed, if mailed by registered or
certified mail, postage prepaid, return receipt requested, as follows:
If to Buyer, to:
WSN Group, Inc.
John Anton, President
1530 Brookhollow, Ste. C
Santa Ana,CA 92750
Copy to:
Marc R. Tow, Esq.
3900 Birch St., Ste. 113
Newport Beach, CA 92660
If to the Seller, to:
Connect4Savings
Rich Alexander, President
42171 #F Big Bear Blvd,
Big Bear, CA 92315
Copy to:
or to such other address as any party shall have designated by like
notice to the other parties hereto (except that a notice of change of
address shall only be effective upon receipt).
10.5. Amendment. This Agreement may only be amended by a
written instrument executed by each of the parties hereto.
10.6. Entire Agreement. This Agreement (together with the
other agreements and documents being delivered pursuant to or in
connection with this Agreement) constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof, and
supersedes all prior agreements and understandings of the parties,
oral and written, with respect to the subject matter hereof.
10.7. Headings. The headings contained herein are for the
sole purpose of convenience of reference, and shall not in any way
limit or affect the meaning or interpretation of any of the terms or
provisions of this Agreement.
10.8. Assignment. Prior to the Closing Date, neither this
Agreement nor any rights, interests or obligations hereunder may be
assigned (by operation of law or otherwise) by any party hereto
without the prior written consent of all of the parties hereto,
except that this Agreement may be assigned to a wholly-owned
subsidiary of Buyer without the need for such prior consent.
10.9. Binding Effect; Benefits. This Agreement shall inure
to the benefit of, and shall be binding upon, the parties hereto and
their respective heirs, legal representatives, successors and
permitted assigns. Nothing herein contained, express or implied, is
intended to confer upon any person other than the parties hereto and
their respective heirs, legal representatives, successors and
permitted assigns, any rights or remedies under or by reason of this
Agreement.
10.10. Waiver, etc. The failure of any of the parties hereto
to at any time enforce any of the provisions of this Agreement shall
not be deemed or construed to be a waiver of any such provision, nor
to in any way affect the validity of this Agreement or any provision
hereof or the right of any of the parties hereto to thereafter
enforce each and every provision of this Agreement. No waiver of any
breach of any of the provisions of this Agreement shall be effective
unless set forth in a written instrument executed by the party or
parties against whom or which enforcement of such waiver is sought;
and no waiver of any such breach shall be construed or deemed to be a
waiver of any other or subsequent breach.
10.11. Severability. Any provision of this Agreement which
is held by a court of competent jurisdiction to be prohibited or
unenforceable in any jurisdictions) shall be, as to such
jurisdictions), ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of
this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
10.12. Announcements; Press Releases. No party hereto shall
issue any press release or otherwise divulge the existence of this
Agreement or the transactions contemplated hereby without the prior
approval of the other parties hereto, except as may be required by
applicable law or the applicable rules or regulations of any stock
exchange.
10.13. Schedules. The Schedules delivered pursuant to this
Agreement are an integral part hereof. Each such Schedule shall be in
writing, shall indicate the section.
10.14 Disputes, Choice of Law. All disputes arising out of
this Agreement shall be submitted for informal resolution to their
respective chief operating officers. Any remaining disputes shall be
conducted in accordance with the Commercial Arbitration Rules of the
Judicial and Mediation Service, Judicate West. The award of the
arbitrators shall include a written explanation of their decision,
shall be limited to remedies otherwise available in court and shall
be binding upon the parties and enforceable in any court of competent
jurisdiction. This agreement shall be governed by and construed in
accordance with the substantive laws of the United States and
California, and any action shall be initiated and maintained in a
forum of competent jurisdiction in such designates state.
IN WITNESS WHEREOF, this Agreement has been executed and
delivered by the parties hereto as of the date first above written.
WSN Group, Inc. (Buyer)
By: /s/ John Anton
John Anton, President
Connect2Save, Inc. (Seller)
By: /s/ Rich Alexander
Rich Alexander, President