UNITED STATES
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):
June 18, 2003
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Florida 000-31507 65-0693481
(State or Other Jurisdiction (Commission File No.) (IRS Employer
of Incorporation) Identification No.)
4232 D'Este Court, Lake Worth, FL. 33467
(Address of Principal Executive Offices) (Zip Code)
561-543-9501
(Registrant's Telephone Number, Including Area Code)
ITEM 1. Changes in Control of Registrant
On August 5, 2003, a change in control of the Registrant occurred in
conjunction with the closing under a Agreement and Plan of Merger dated
June 18, 2003, amended on August 5, 2003, ("Merger Agreement") between
the Registrant and Clear Wire Networks, Inc. of Plano, Texas. The
signing of the original Merger Agreement was previously announced on
June 18, 2003. The Merger Agreement, as amended August 5, 2003, is
attached to this Report as Exhibit 2. Pursuant to the Merger Agreement
Articles of Merger have been signed and filed with the states of
Florida and Texas to complete the merger process. Copies of the
Articles of Merger are attached to this Report as Exhibits 99.1 and
99.2. The Registrant is the surviving company in the merger, and will
be relocating its principal offices to the Dallas area. It is also
anticipated that the Registrant will request its shareholders to
approve the change of its name to Altius Technology Corporation, Inc.
in the near future.
Under terms of the merger, shareholders of Clear Wire Technology, Inc.
have received common and voting, convertible preferred shares in the
Registrant representing collectively seventy-two percent (72%) of the
voting power of the merged company. The existing shareholders of the
Registrant retained their existing shares, representing fifteen percent
(15%) of the outstanding voting power of the merged Company. The
remaining thirteen percent (13%) of the merged Company is held by
brokers and other outside shareholders. The voting, convertible
preferred shares issued to the shareholders of Clear Wire Technology
will vote with the outstanding common shares, but will have forty votes
per share, with each share of preferred stock convertible into forty
shares of common stock as soon as the corporate articles are amended to
authorize additional shares.
Also pursuant to the Merger Agreement the Registrant will issue
2,360,430 shares of common stock to Vida Technologies, Inc. and
2,360,430 shares of common stock to Infinite Technology Corporation in
exchange for their interests in Altius Joint Venture, in which Clear
Wire Technology, Inc. held the remaining interest.
Clear Wire was a joint business venture of Vida Technologies, a Texas-
based fiber optics systems company, and Infinite Technology
Corporation, a Dallas-based system-on-chip (SoC) intellectual property
and technology firm. The merged Company expects to operate as Altius
Technology Corporation and has plans to develop the world's lowest cost
fiber-to-the-home (FTTH) customer premises equipment. Altius products
will be based on Vida's fiber optics systems expertise and ITC's sub-
micron SoC design expertise and technologies. Initial customers for
Altius products will be in Asia, Australia and the USA.
The new Board of Directors of the Registrant consists of Tim B. Smith,
as the Registrant's chairman who owns 100,000 newly issued preferred
shares directly and indirectly 118,000 shares of preferred shares and
278,531 newly issued common shares by virtue of his 11.8% ownership in
Infinite Technology Corporation, Inc., John Shaunfield, Chief Executive
Officer, who owns 200,000 newly issued preferred shares directly and
indirectly 423,700 shares of preferred shares and 1,000,114 newly
issued common shares by virtue of his 42.37% ownership in Vida
Technologies, Inc., Todd Grassi, President and Treasurer, who owns
200,000 newly issued preferred shares directly and indirectly 423,700
shares of preferred shares and 1,000,114 newly issued common shares by
virtue of his 42.37% ownership in Vida Technologies, Inc., and David
Pells, Secretary who owns 100,000 newly issued preferred shares
directly and indirectly 50,000 newly issued preferred shares owned by
his spouse.
EXHIBITS
2 Agreement and Plan of Merger between the Registrant and
Clear Wire Networks, Inc.
99.1 Florida Articles of Merger
99.2 Texas Articles of Merger
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
International Trust & Financial Systems, Inc.
Dated: August 25, 2003
/s/ Todd Grassi
______________________
Name: Todd Grassi
Title: President
AGREEMENT AND PLAN OF MERGER
between
CLEAR WIRE NETWORKS, INC.
and
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
Dated
June 18, 2003
As amended
August 5, 2003
This Page Intentionally Left Blank.
AGREEMENT AND PLAN OF MERGER ("Agreement") dated as of June 18, 2003
between CLEAR WIRE NETWORKS, INC., a Texas corporation ("CLEAR WIRE"),
and INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC., a Florida
corporation ("ITFS").
RECITALS
WHEREAS, the Board of Directors of each of CLEAR WIRE and ITFS deem it
advisable for the general welfare of their stockholders that CLEAR WIRE
and ITFS merge (the "Merger") into a single corporation pursuant to
this Agreement and the applicable laws of the States of Florida and
Texas; and
WHEREAS, CLEAR WIRE and ITFS desire to adopt this Agreement as a Plan
of Reorganization and to consummate the merger in accordance with the
provisions of Section 368(a)(1)(A) of the Internal Revenue Code of
1986, as amended.
NOW, THEREFORE, CLEAR WIRE and ITFS agree that CLEAR WIRE shall be
merged with and into ITFS, with ITFS as the surviving corporation in
accordance with the applicable laws of Florida and Texas (which in its
capacity as surviving corporation is hereinafter called the "Surviving
Corporation"), that the Surviving Corporation shall change its name to
Altius Technology Corporation pursuant to the provisions of the Florida
General Corporation Law ("FGCL"), and, subject to the applicable
provisions of the Texas Business Corporation Act ("TBCA") and the FGCL,
that the terms and conditions of the merger and the mode of carrying it
into effect shall be as follows:
ARTICLE 1: THE MERGER
1.1 The Merger. At the Effective Time (as defined in Section 1.2),
upon the terms and subject to the conditions of this Agreement and the
FGCL and TBCA, CLEAR WIRE shall be merged with and into ITFS, the
separate corporate existence of CLEAR WIRE shall cease and ITFS shall
be renamed to Altius Technology Corporation and continue after the
Merger as the Surviving Corporation. This Agreement shall be submitted
to shareholders of CLEAR WIRE and ITFS in the manner prescribed by and
if required by applicable laws and, if applicable, approved at meetings
called for that purpose or by written consents in lieu of meetings.
1.2 Effective Time; Closing. Within thirty (30) days after adoption
of this Agreement by shareholders of CLEAR WIRE and pursuant to the
laws of the States of Florida and Texas and the satisfaction or waiver
of the conditions set forth in Article 6, the parties hereto shall
cause the Merger to be consummated by executing, delivering and filing
the Articles of Merger with the Secretary of State of the States of
Florida and Texas in such form as required by, and executed in
accordance with the relevant provisions of the FGCL and TBCA (the time
of such filing being the "Effective Time"), and the parties shall take
all such other and further actions as may be required by law to cause
the Merger to become effective. Prior to the filing of the Certificate
of Merger, a closing (the "Closing") will be held among the parties
hereto (if a meeting is not possible, then by telephone and facsimile)
and their counsel for the purpose of confirming all the foregoing.
1.3 Effect of the Merger. At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of the FGCL
and TBCA. Without limiting the generality of the foregoing, and
subject thereto, at the Effective Time all the property, rights,
privileges, powers and franchises of CLEAR WIRE and ITFS shall vest in
the Surviving Corporation, and all debts, liabilities and duties of
CLEAR WIRE and ITFS shall become the debts, liabilities and duties of
the Surviving Corporation.
1.4 Subsequent Actions. After the Effective Time, the Surviving
Corporation shall consider or be advised that deeds, bills of sale,
assignments, assurances or any other actions or things that may be
necessary or desirable to vest, perfect or confirm of record or
otherwise in the Surviving Corporation its right, title or interest in,
to or under any of the rights, properties or assets of either of CLEAR
WIRE or ITFS acquired or to be acquired by the Surviving Corporation as
a result of, or in connection with, the Merger or otherwise to carry
out this Agreement. In such event, the officers and directors of the
Surviving Corporation shall be authorized to execute and deliver, in
the name and on behalf of either CLEAR WIRE or ITFS, all such deeds,
bills of sale, assignments and assurances and to take and do, in the
name and on behalf of each of such corporations or otherwise, all such
other actions and things as may be necessary or desirable to vest,
perfect or confirm any and all right, title and interest in, to and
under such rights, properties or assets in the Surviving Corporation or
otherwise to carry out this Agreement.
1.5 Articles of Incorporation; By-Laws; Directors and Officers.
(a) At the Effective Time, the Articles of Incorporation of ITFS as in
effect immediately before the Effective Time, shall be the Articles of
Incorporation of the Surviving Corporation until thereafter amended as
provided by law.
(b) At the Effective Time, the By-Laws of ITFS, as in effect
immediately before the Effective Time, shall be the By-Laws of the
Surviving Corporation until thereafter amended as provided by law, the
Articles of Incorporation of the Surviving Corporation and such By-
Laws.
(c) The board of directors of the Surviving Corporation shall be
elected by written consent action of a majority of the shareholders of
the Surviving Corporation entitled to vote thereon in lieu of an Annual
Meeting of Shareholders, immediately after the Merger, to serve until
their successors are duly elected or appointed and shall qualify. The
officers of the Surviving Corporation shall thereafter be elected by
the newly elected Board of Directors of the Surviving Corporation and
shall serve until their successors are duly elected or appointed and
shall qualify. If, at the Effective Time, a vacancy shall exist on the
Board of Directors or in any office of the Surviving Corporation, such
vacancy may thereafter be filled in the manner provided by law or by
the Articles of Incorporation and By-Laws of ITFS.
1.6 Conversion of Securities. At the Effective Time, by virtue of the
Merger and without any action on the part of CLEAR WIRE, ITFS or the
holder of any of the following securities:
(a) The owners of all of the issued and outstanding Common Stock of
ITFS immediately prior to the Effective Time shall retain their shares
as fully paid and non-assessable shares of ITFS, which shares represent
100 percent of the total outstanding shares of ITFS prior to the merger
and will represent 15 percent of the total outstanding voting shares of
the Surviving Corporation immediately after the Merger.
(b) Each owner of the 287,000 shares of the issued and outstanding
shares of Common Stock of CLEAR WIRE immediately prior to the Effective
Time shall receive ten (10) convertible, voting preferred shares of the
Surviving Corporation having the rights and preferences stated in
Appendix "A" to this Agreement, with each share of preferred stock
convertible into 40 shares of common stock of the Surviving Corporation
(as adjusted for subsequent stock splits) following the payment in full
of the promissory notes referred to in Appendix "E to this Agreement
and to the amendment to the Articles of Incorporation of the Surviving
Corporation to authorize additional common shares, for each share of
CLEAR WIRE, for a total of 2,870,000 convertible preferred shares,
immediately after the Merger.
(c) An additional 20,789,224 shares of Common Stock in the Surviving
Corporation shall be issued to designees of The Hubinger Organization
to bring the total issued and outstanding Common Stock of the Surviving
Corporation after the Merger to 50,000,000 shares and the total issued
and outstanding Preferred Stock of the Surviving Corporation after the
Merger to 2,870,000 shares, and the total authorized combined vote of
the outstanding shares of the Surviving Corporation to 162,800,000
votes. The shares to be issued to The Hubinger Organization shall not
be issued until such time as all of the promissory notes of ITFS
referred to in Appendix "E" to this Merger Agreement have been paid in
full according to their terms, and in the event that the said
promissory notes are not paid in full according to their terms, then
the shares to be issued to The Hubinger Organization shall not be
issued.
(e) Each Share of common or preferred stock held in the treasury of
ITFS and CLEAR WIRE immediately prior to the Effective Time shall be
cancelled and extinguished in the Merger and no payment or other
consideration shall be made with respect thereto.
1.7 Options and Other Rights. All options and warrants to purchase
ITFS shares granted by ITFS ("Options"), whether vested or unvested,
which are outstanding and not exercised prior to the Effective Time
shall be cancelled and extinguished and no payment or other
consideration shall be made with respect thereto, except for the
warrants subject to the Warrant Agreement described on Appendix "B" to
this Agreement. All options and warrants to purchase CLEAR WIRE shares
granted by CLEAR WIRE ("Options"), whether vested or unvested, which
are outstanding and not exercised prior to the Effective Time shall
also be cancelled and extinguished and no payment or other
consideration shall be made with respect thereto
ARTICLE 2: EXCHANGE OF SHARES
2.1 Exchange of Shares by Owners of ITFS Stock. At Closing, or as
promptly as practicable after Closing, each holder of an outstanding
certificate or certificates theretofore representing shares of ITFS
Common Stock shall surrender the same to ITFS's transfer agent
("Transfer Agent"), and shall receive in exchange therefore, a
certificate or certificates representing the same number of full shares
of Altius Technology Corporation Common Stock, in accordance with the
provisions of Article 1.6(a) of this Agreement.
2.2Exchange of Shares by Owners of CLEAR WIRE Common Stock. At
Closing, or as promptly as practicable after Closing, each holder of an
outstanding certificate or certificates theretofore representing shares
of CLEAR WIRE Common Stock shall surrender the same to the Surviving
Corporation and shall receive in exchange therefore a certificate or
certificates representing ten full shares of the Surviving
Corporation's Preferred Stock for each share of CLEAR WIRE common stock
represented by such certificate, in accordance with Article 1.6(b) of
this Agreement and the table set forth on Appendix "C" hereto.
2.3Issuance of New Shares in Altius Technology Corporation. In
exchange for their current joint venture interests in the Altius Joint
Venture, a Texas partnership (the "Joint Venture"), new shares of
Common Stock in the Surviving Corporation shall be issued to the
following on transfer and conveyance of their respective interests in
the Joint Venture to the Surviving Corporation:
Name
Number of New Altius
Shares to be Issued
Infinite Technology Corporation
2,360,430
Vida Technologies, Inc.
2,360,430
Following and conditioned upon the transfers of their respective
interests in the Joint Venture to the Surviving Corporation, the
Surviving Corporation shall be the sole owner of all of the interests
in the Joint Venture, which will result in the Joint Venture
partnership terminating and becoming a part of and wholly-owned by the
Surviving Corporation.
2.4Fractional Shares. Fractional shares of ALTIUS Common Stock shall
not be issued. In lieu thereof, a holder who would otherwise be
entitled to a fractional share shall receive a number of whole shares
rounded to the next highest whole number.
2.3 Unexchanged Certificates. Until surrendered, each outstanding
certificate which, prior to the Effective Time, represented ITFS Common
Stock shall be deemed for all purposes, other than the payment of
dividends or other distributions, to evidence ownership of the whole
number of shares of the Surviving Corporation's Common Stock into which
it is to be converted, and no dividend or other distribution payable to
holders of ITFS Common Stock as of any date subsequent to the Effective
Time shall be paid to the holders of outstanding ITFS certificates.
There shall be paid to the record holders of the certificates of the
Surviving Corporation issued in exchange therefor the amount, without
interest thereon, of dividends and other distributions which would have
been payable with respect to the shares of ITFS Common Stock
represented thereby.
Article 3: REPRESENTATIONS AND WARRANTIES OF CLEAR WIRE
CLEAR WIRE represents and warrants to, and agrees with, ITFS as
follows:
3.1 Organization.
(a) CLEAR WIRE is a corporation duly organized, validly existing and
in good standing under the laws of the State of Texas. CLEAR WIRE has
all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted.
CLEAR WIRE is duly qualified to do business and in good standing as a
foreign corporation in each other jurisdiction, if any, in which its
property or business makes such qualification necessary. CLEAR WIRE
has heretofore delivered to ITFS true, accurate and complete copies of
CLEAR WIRE's Articles of Incorporation and By-Laws as in effect on the
date hereof and minutes of all meetings of shareholders and directors
of CLEAR WIRE held through and including the date of this Agreement.
CLEAR WIRE is not in violation of any of the provisions of its Articles
of Incorporation or By-Laws.
(b) CLEAR WIRE has no subsidiaries or affiliates and does not
otherwise own any shares of stock or any interest in, or control, any
other person or entity.
3.2 Authority Relative to this Agreement. CLEAR WIRE has full
corporate power and authority to execute and deliver this Agreement and
to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the Board
of Directors of CLEAR WIRE and, except for approval of the shareholders
of CLEAR WIRE, no other corporate proceedings on the part of CLEAR WIRE
are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been duly and
validly executed and delivered by CLEAR WIRE and constitutes a valid
and binding agreement, enforceable against it in accordance with its
terms.
3.3 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement by CLEAR WIRE does
not, and the consummation of the transactions contemplated hereby will
not, (i) conflict with or violate any law, regulation, court order,
judgment or decree applicable to CLEAR WIRE or by which its properties
are bound or affected, (ii) violate or conflict with either the
Articles of Incorporation or By-Laws of CLEAR WIRE or (iii) result in
any breach of or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others
any right of termination or cancellation of, or result in the creation
of a lien on any of the properties of CLEAR WIRE or the Surviving
Corporation pursuant to any contract to which CLEAR WIRE is a party or
by which CLEAR WIRE or any of its respective properties is bound or
affected.
(b) CLEAR WIRE is not required to submit any notice, report or other
filing with any governmental entity or regulating body, domestic or
foreign, in connection with the execution, delivery or performance of
this Agreement or the consummation of the transactions contemplated
hereby. No waiver, consent, approval or authorization of any
governmental entity or regulatory body, domestic or foreign, is
required to be obtained or made by CLEAR WIRE in connection with its
execution, delivery or performance of this Agreement or the
consummation of the transactions contemplated hereby.
3.4 Capitalization. As of the Closing, CLEAR WIRE shall have
authorized capital stock of 1,000,000 shares of common stock, of which
282,000 are issued and outstanding. All the outstanding shares of
capital stock of CLEAR WIRE have been duly authorized and are validly
issued, and non-assessable. No options, warrants, conversion rights,
subscriptions or purchase rights of any other nature to acquire from
CLEAR WIRE, or commitments of CLEAR WIRE to issue, shares of capital
stock or other securities are authorized, issued or outstanding, nor is
CLEAR WIRE obligated in any other manner to issue shares or rights to
acquire any of its capital stock or other securities. None of CLEAR
WIRE's outstanding securities or authorized capital stock is subject to
any rights of redemption, repurchase, rights of first refusal,
preemptive rights or other similar rights, whether contractual,
statutory or otherwise, for the benefit of CLEAR WIRE, any stockholder,
or any other person or entity.
There are no restrictions on the transfer of shares of capital stock of
CLEAR WIRE other than those imposed by relevant federal and state
securities laws and as otherwise contemplated by this Agreement.
Except as set forth in Exhibit 3.4(a) and 3.4(b), there are no
agreements, understandings, trusts or other collaborative arrangements
or understandings concerning the voting or transfer of the capital
stock of CLEAR WIRE. The offer and sale of all capital stock and other
securities of CLEAR WIRE issued before the date hereof and to be issued
hereafter complied with or were exempt or will comply with or be exempt
from all applicable federal and state securities laws and no
stockholder has a right of rescission or damages with respect thereto.
CLEAR WIRE does not have outstanding, and has no obligation to grant or
issue, any "phantom stock" or other right measured by the profits,
revenues or results of operations of CLEAR WIRE or any portion thereof;
or any similar rights.
3.5 Financial Statements. (a) CLEAR WIRE's balance sheet as of
December 31, 2002 (the "CLEAR WIRE Balance Sheet"), and the related
statements of income and retained earnings for the period ended
December 31, 2002 (the "CLEAR WIRE Financial Statements"), copies of
which have been delivered by CLEAR WIRE to ITFS, fairly present the
financial condition of CLEAR WIRE as of said dates and the results of
its operations for the periods then ended. CLEAR WIRE shall deliver
financial statements within sixty days of the date hereof which shall
be prepared in conformity with Generally Accepted Accounting Principles
("GAAP") consistently applied for the periods covered (the "Financial
Statements"). The Financial Statements (x) shall be prepared in
accordance with GAAP applied on a consistent basis, (y) are in
accordance with the books and records of CLEAR WIRE and (z) shall
present fairly the financial position and results of operations of
CLEAR WIRE at the dates and for the periods to which they relate.
CLEAR WIRE has maintained its books of account in accordance with GAAP
applied on a consistent basis, and such books and records are, and
during the periods covered by the CLEAR WIRE Financial Statements were,
correct and complete in all material respects, fairly and accurately
reflect and reflected the income, expenses, assets and liabilities of
CLEAR WIRE, and provide and provided a fair and accurate basis for the
preparation of the CLEAR WIRE Financial Statements and of the Tax
returns and reports of CLEAR WIRE.
(a) CLEAR WIRE received a corporate "valuation" from The Structured
Advantage of Texas, an accounting and financial services company based
in Dallas, Texas, in November, 2002 which valued the assets of the
Joint Venture at twenty three million, nine hundred ninety two thousand
eight hundred ninety dollars ($23,992,890). This valuation is not and
will not be reflected on the CLEAR WIRE balance sheet or financial
statements.
(b) Except as noted in paragraph 3.5 (a) above, and to the extent
reflected in the CLEAR WIRE Balance Sheet, on December 31, 2002, CLEAR
WIRE did not have any direct or indirect Liabilities, whether due or to
become due, or arising out of transactions entered into, or any state
of facts existing, on or prior to June 30, 2003 which would be required
to be reflected on the CLEAR WIRE Balance Sheet in accordance with
GAAP.
3.6 Real and Personal Property.
(a) CLEAR WIRE owns no real property. CLEAR WIRE has delivered to
ITFS correct and complete copies of the leases and subleases for all
real property leased or subleased by CLEAR WIRE. With respect to each
such lease and sublease:
(i) the lease or sublease is legal, valid, binding, enforceable
against CLEAR WIRE and the lessor and the lease is in full force and
effect;
(ii) the lease or sublease will continue to be legal, valid, binding,
enforceable and in full force and effect on substantially the same
terms following the consummation of the transactions contemplated
hereby;
(iii) CLEAR WIRE is not and no other party to the lease or sublease is
in breach or default, and no event has occurred which, with notice or
lapse of time, would constitute a breach or default or permit
termination, modification, or acceleration thereunder;
(iv) there are no disputes, oral agreements, or forbearance programs
in effect as to the lease or sublease;
(v) with respect to each sublease, the representations and warranties
set forth in subsections (i) through (iv) above are true and correct
with respect to the underlying lease;
(vi) CLEAR WIRE has not assigned, transferred, conveyed, mortgaged,
deeded in trust, or encumbered any interest in the leasehold or
subleasehold;
(vii) all facilities leased or subleased thereunder have received all
approvals of governmental authorities (including licenses and permits)
required in connection with the operation thereof and have been
operated and maintained in accordance with applicable laws, rules, and
regulations;
(viii) all facilities leased or subleased thereunder are supplied with
utilities and other services necessary for the operation of said
facilities.
(b) CLEAR WIRE has good and marketable title to, or valid leasehold
interests in, all other assets used or held for use in the conduct of
its business, including, without limitation, the assets reflected on
the CLEAR WIRE Balance Sheet or acquired after the date thereof (other
than those which have been disposed of in the ordinary course of
business since such date), free and clear of any liens, other than
liens reflected on the CLEAR WIRE Balance Sheet and liens for taxes not
yet due and payable. All of the assets owned or leased by CLEAR WIRE
are in all material respects in good condition and repair, ordinary
wear and tear excepted, and well maintained. There are no material
capital expenditures currently contemplated or necessary to maintain
the current business of CLEAR WIRE.
3.7 Absence of Undisclosed Liabilities. Except to the extent
reflected or reserved against in the CLEAR WIRE Balance Sheet, CLEAR
WIRE does not have at that date any liabilities or obligations
(secured, unsecured, contingent or otherwise) of a nature customarily
reflected in a corporate balance sheet prepared in accordance with
generally accepted accounting principles ("Liabilities").
3.8 Absence of Certain Changes. Since December 31, 2002, (i) there
has been no material adverse change in the condition (financial or
otherwise), assets, liabilities, results of operations, business or
prospects of CLEAR WIRE, and (ii) nothing has occurred relative to the
business or prospects of CLEAR WIRE which would have a material adverse
effect on the future business of CLEAR WIRE.
3.9 Litigation. No investigation or review by any governmental entity
or regulatory body, foreign or domestic, with respect to CLEAR WIRE is
pending or threatened against CLEAR WIRE, and no governmental entity or
regulatory body has advised CLEAR WIRE of an intention to conduct the
same. There is no claim, action, suit, investigation or proceeding
pending or threatened against or affecting CLEAR WIRE at law or in
equity or before any federal, state, municipal or other governmental
entity or regulatory body, or which challenges the validity of this
Agreement or any action taken or to be taken by CLEAR WIRE pursuant to
this Agreement. As of the date hereof, CLEAR WIRE is not subject to,
nor is there in existence, any outstanding judgment, award, order,
writ, injunction or decree of any court, governmental entity or
regulatory body relating to CLEAR WIRE.
3.10 Contracts.
(a) CLEAR WIRE has provided, or prior to the Closing will provide,
ITFS with copies of the following contracts, agreements, leases,
licenses, arrangements, commitments, sales orders, purchase orders or
any claim or right or any benefit or obligation arising thereunder or
resulting therefrom and currently in effect, whether oral or written to
which CLEAR WIRE is a party ("Contracts"):
(i) any Contract (or group of related Contracts) for the lease of
personal property to or from any person providing for lease payments in
excess of $10,000 per annum;
(ii) any Contract (or group of related Contracts) for the purchase or
sale of raw materials, commodities, supplies, products, or other
personal property, or for the furnishing or receipt of services, the
performance of which will extend over a period of more than one year,
result in a loss to CLEAR WIRE, or involve consideration in excess of
$10,000;
(iii) any Contract concerning a partnership or joint venture;
(iv) any Contract (or group of related Contracts) under which it has
created, incurred, assumed, or guaranteed any indebtedness for borrowed
money, or any capitalized lease obligation or under which it has
imposed a lien on any of its assets, tangible or intangible;
(v) any Contract concerning confidentiality or noncompetition;
(vi) any profit sharing, stock option, stock purchase, stock
appreciation, deferred compensation, severance or other plan or
arrangement for the benefit of its current or former directors,
officers, and employees;
(vii) any Contract under which it has advanced or loaned any amount to
any of its directors, officers, and employees outside the ordinary
course of business;
(viii) any Contract under which the consent of the other party thereto
is required in connection with the assignment of such Contract in
connection with the transaction contemplated hereby;
(ix) any Contract under which the consequences of a default or
termination could have a material adverse effect on CLEAR WIRE; or
(x) any other Contract (or group of related Contracts) the performance
of which involves consideration in excess of $10,000.
(b) All Contracts have been duly authorized and delivered by CLEAR
WIRE and any third party thereto, are in full force and effect against
CLEAR WIRE and constitute the valid and binding obligations of CLEAR
WIRE and the respective parties thereto enforceable in accordance with
their respective terms. As to the Contracts, (i) there are no existing
breaches or defaults by CLEAR WIRE thereunder or by the other parties
to such Contracts, (ii) no event, act or omission has occurred or, as a
result of the consummation of the transactions contemplated hereby,
will occur which (with or without notice, lapse of time or the
happening or occurrence of any other event) would result in a default
by CLEAR WIRE thereunder or give cause for termination thereof,
provided that insofar as the foregoing representation involves the
actions or omissions of parties other than CLEAR WIRE, it shall be
limited to the knowledge of CLEAR WIRE, (iii) none of them will result
in any loss to CLEAR WIRE upon completion or performance thereof and
(iv) none of the parties to Contracts have expressed an indication to
CLEAR WIRE of their intention to cancel, renegotiate or exercise or not
exercise any option under any such Contracts.
3.11 Intellectual Property.
(a) CLEAR WIRE owns or has the right to use pursuant to license,
sublicense, agreement, or permission all (i) inventions (whether
patentable or unpatentable and whether or not reduced to practice), all
improvements thereto, and all patents, patent applications, and patent
disclosures, together with all reissuances, continuations,
continuations-in-part, revisions, extensions, and reexaminations
thereof, (ii) trademarks, service marks, trade dress, logos, trade
names, and corporate names, together with all translations,
adaptations, derivations, and combinations thereof and including all
goodwill associated therewith, and all applications, registrations, and
renewals in connection therewith, (iii) copyrightable works, all
copyrights, and all applications, registrations, and renewals in
connection therewith, (iv) mask works and all applications,
registrations, and renewals in connection therewith, (v) trade secrets
and confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and
production processes and techniques, technical data, designs, drawings,
blueprints, sketches, storyboards, models, engineering drawings,
specifications, customer and supplier lists, pricing and cost
information, and business and marketing plans and proposals), (vi)
computer software (including data and related documentation), (vii)
other proprietary rights and Know-how, (viii) copies and tangible
embodiments of any of the foregoing (in whatever form or medium) and
(ix) licenses and sublicenses granted and obtained with respect
thereto, and rights thereunder ("Intellectual Property") necessary for
the operation of the businesses of CLEAR WIRE and as proposed to be
conducted. All of the Intellectual Property is identified and listed
on Appendix "D" to this Agreement and will be conveyed to the Surviving
Corporation at the Effective Date by appropriate assignments, bills of
sale or other instruments, with the consent of any other party thereto
to the assignments necessary to make the assignments fully effective
without default or breach of any agreement.
(b) To the best of CLEAR WIRE's knowledge after due inquiry, CLEAR
WIRE has not interfered with, infringed upon, misappropriated or come
into conflict with any Intellectual Property rights of third parties
and CLEAR WIRE has never received any charge, complaint, claim, demand,
or notice alleging any such interference, infringement,
misappropriation, or violation (including any claim that CLEAR WIRE
must license or refrain from using any Intellectual Property rights of
any third party). No third party has interfered with, infringed upon,
misappropriated, or otherwise come into conflict with any Intellectual
Property rights of any of CLEAR WIRE.
(c) With respect to each item of Intellectual Property owned by CLEAR
WIRE:
(i) CLEAR WIRE possesses all right, title, and interest in and to the
item, free and clear of any lien, license, or other restriction;
(ii) the item is not subject to any outstanding injunction, judgment,
order, decree, ruling, or charge;
(iii) no action, suit, proceeding, hearing, investigation, charge,
complaint, claim, or demand is pending or, to the knowledge of CLEAR
WIRE, is threatened which challenges the legality, validity,
enforceability, use, or ownership of the item; and
(iv) CLEAR WIRE has never agreed to indemnify any person for or
against any interference, infringement, misappropriation, or other
conflict with respect to the item.
(d) With respect to each item of Intellectual Property used by CLEAR
WIRE pursuant to any license, sublicense, agreement or permission:
(i) the license, sublicense, agreement, or permission covering the
item is legal, valid, binding, enforceable, and in full force and
effect, subject generally to the laws of bankruptcy and reorganization;
(ii) the license, sublicense, agreement, or permission will continue
to be legal, valid, binding, enforceable, and in full force and effect
on identical terms following the consummation of the transactions
contemplated hereby;
(iii) no party to the license, sublicense, agreement, or permission is
in breach or default, and no event has occurred which with notice or
lapse of time would constitute a breach or default or permit
termination, modification, or acceleration thereunder;
(iv) no party to the license, sublicense, agreement, or permission has
repudiated any provision thereof;
(v) with respect to each sublicense, the representations and
warranties set forth in subsections (i) through (iv) above are true and
correct with respect to the underlying license;
(vi) the underlying item of Intellectual Property is not subject to
any outstanding injunction, judgment, order, decree, ruling, or charge;
(vii) no action, suit, proceeding, hearing, investigation, charge,
complaint, claim, or demand is pending or threatened which challenges
the legality, validity, or enforceability of the underlying item of
Intellectual Property; and
(viii) CLEAR WIRE has never granted any sublicense or similar right
with respect to the license, sublicense, agreement, or permission.
(e) CLEAR WIRE does not and will not, interfere with, infringe upon,
misappropriate, or otherwise come into conflict with, any Intellectual
Property rights of third parties as a result of the continued operation
of its businesses as presently conducted and as presently proposed to
be conducted.
3.12 Software.
(a) Except with respect to software programs licensed to CLEAR WIRE,
CLEAR WIRE is in actual possession of the source code of each software
program used in connection with its business, and CLEAR WIRE is in
possession of all other documentation reasonably necessary for the
effective use of each such software program.
(b) To the best of CLEAR WIRE's actual knowledge, there are no defects
in any of the software offered by CLEAR WIRE in connection with its
business which would in any material and adverse respect affect the
functioning of any such software in accordance with the specifications
therefor published by CLEAR WIRE or heretofore provided to any
customers or prospective customers of CLEAR WIRE, and each piece of
such software, together with all know-how and processes used in
connection therewith, functions as intended, conforms to all applicable
industry standards, contains all current revisions of such software and
includes all computer programs, materials, tapes, know-how, object and
source codes and procedures used by CLEAR WIRE in the conduct of its
business. Insofar as the foregoing representation relates to software
not owned by CLEAR WIRE, such representation and warranty is to the
knowledge of CLEAR WIRE.
3.13 Receivables; Payables.
(a) All accounts receivable of CLEAR WIRE which are or will be
reflected on the CLEAR WIRE Financial Statements will arise in the
ordinary course of business out of bona fide sales and deliveries of
goods, services or other business transactions. All accounts
receivables of CLEAR WIRE are reflected properly on its books and
records, are valid receivables subject to no setoffs or counterclaims
of which CLEAR WIRE is aware, are current and to the knowledge of CLEAR
WIRE, collectible, and will be collected in accordance with their terms
at their recorded amounts.
(b) All accounts payable (including, without limitation, Taxes
payable) reflected on the CLEAR WIRE Interim Balance Sheet and all
accounts payable of CLEAR WIRE arising subsequent to the Balance Sheet
Date, have been and are being paid in the ordinary course of its
business and consistent with past practice.
3.14 Licenses, Permits and Consents; Compliance with Applicable Law.
(a) CLEAR WIRE possesses all licenses and permits which individually
or in the aggregate are material to the conduct of the business of
CLEAR WIRE or any of its employees by reason of such employee's
activities on behalf of CLEAR WIRE under applicable law or required by
any federal, state, local or foreign governmental entity or regulatory
body for the operation of the business of CLEAR WIRE, and all of such
listed licenses and permits are in full force and effect as of the date
hereof and will remain in full force and effect following the
consummation of the transactions contemplated hereby. CLEAR WIRE has
not received notice and has no reason to believe, that any appropriate
authority intends to cancel or terminate any of such licenses or
permits or that valid grounds for such cancellation or termination
currently exist.
(b) CLEAR WIRE is not in material violation or breach of any, and the
business and operations of CLEAR WIRE comply in all material respects
and are being conducted in accordance with, all material governing
laws, regulations and ordinances applicable thereto and CLEAR WIRE is
not in material violation of or in material default under any judgment,
award, order, writ, injunction or decree of any court, arbitration
tribunal, governmental entity or regulatory body.
3.15 Insurance. CLEAR WIRE maintains insurance covering it's
properties and business adequate and customary for the type and scope
of the properties, assets and business, and similar to companies of
comparable size and condition similarly situated in the same industry
in which CLEAR WIRE operates, but in any event in amounts sufficient to
prevent CLEAR WIRE from becoming a co-insurer or self-insurer, with
provision for reasonable deductibles and following the Effective Time,
CLEAR WIRE will use its reasonable best efforts to obtain as promptly
as practicable comparable insurance coverage under policies in CLEAR
WIRE's own name on commercially reasonable terms.
3.16 Tax Matters. CLEAR WIRE has timely filed all required federal,
state, local, foreign and other governmental Tax returns and reports
required to be filed by it for all taxable periods ending on or before
the date hereof. As of the time of filing, such returns and reports
were true, complete and correct and were made on a proper basis. All
federal, state, local and foreign income, unincorporated business,
gross receipts, franchise, profits, property, capital, intangibles,
employment, excise or other taxes, fees, stamp taxes, duties,
penalties, assessments, governmental charges or other payments
(collectively "Tax" or "Taxes") for all periods up to and including the
date hereof have been duly paid or withheld or are, or will on the date
hereof be, adequately reserved for or withheld in accordance with GAAP
applied on a consistent basis.
3.17 Books and Records. The corporate minute books, stock certificate
books, stock registers and other corporate records of CLEAR WIRE are
correct and complete in all material respects, and the signatures
appearing on all documents contained therein are the true signatures of
the persons purporting to have signed the same.
3.18. Entire Business. No portion of the business of CLEAR WIRE is
conducted by third parties and all of the assets necessary for the
conduct of the business of CLEAR WIRE as presently conducted are owned
by CLEAR WIRE. All such assets are exclusively owned or leased and
used by CLEAR WIRE and its customers. CLEAR WIRE has no investments
other than (1) securities that are publicly traded and unrestricted in
the hands of CLEAR WIRE, and (2) cash, commercial paper and other cash
equivalents.
3.19. Employee Benefit Plans. Each employee benefit plan (and each
related trust, insurance contract, or fund) complies in form and in
operation in all respects with the applicable requirements of ERISA,
the Internal Revenue Code (the "Code"), and other applicable laws. All
required reports and descriptions have been filed or distributed
appropriately with respect to each such employee benefit plan.
3.20 Suppliers and Customers.
(a) CLEAR WIRE has no knowledge or information or reason to believe
that any significant supplier has ceased, or intends to cease, to sell
goods or services to CLEAR WIRE or has substantially reduced, or
intends to substantially reduce, the sale of such goods or services
either as a result of the transaction contemplated by this Agreement or
otherwise or intends to sell such goods and services other than on
terms and conditions similar to those imposed on prior sales to CLEAR
WIRE.
(b) CLEAR WIRE has no knowledge that any of its significant customers
has ceased, or intends to cease, to purchase goods from CLEAR WIRE,
either as a result of the transaction contemplated hereby or otherwise.
3.21 Product Warranties, Product Return Policies and Service
Warranties. To the best of CLEAR WIRE's knowledge, each product or
service developed, sold or provided by CLEAR WIRE has been in
conformity with all applicable contractual commitments and all express
and implied warranties, and CLEAR WIRE has no liability for replacement
or repair thereof or other damages in connection therewith. No product
or service developed, sold or provided by CLEAR WIRE is subject to any
guaranty, warranty, or other indemnity beyond the applicable standard
terms and conditions of sale or lease. There are no pending and
suspected claims or demands nor threatened claims or demands, seeking
return, replacement and/or repair of products pursuant to warranties
extended by CLEAR WIRE prior to the date hereof.
3.22 Employees: Labor Matters.
(a) No officer, employee or consultant of CLEAR WIRE is, or is now
anticipated to be, in violation of any material term of any employment
contract, patent disclosure agreement, proprietary information
agreement, noncompetition agreement, nonsolicitation agreement,
confidentiality agreement, or any other similar contract or agreement
or any restrictive covenant, including those set forth on, relating to
the right of any such officer, employee, or consultant to be employed
or engaged by CLEAR WIRE because of the nature of the business
conducted or to be conducted by CLEAR WIRE or relating to the use of
trade secrets or proprietary information of others, and to the
knowledge of CLEAR WIRE; the continued employment or engagement of
CLEAR WIRE's officers, employees or consultants does not subject CLEAR
WIRE to any liability with respect to any of the foregoing matters.
(b) No officer, consultant or key employee of CLEAR WIRE whose
termination, either individually or in the aggregate, could have a
material adverse effect on CLEAR WIRE, has terminated since the date
hereof; or has any present intention of terminating, his employment or
engagement with CLEAR WIRE, nor has any such person been, or been
proposed to be terminated by CLEAR WIRE.
(c) CLEAR WIRE is not a party to any collective bargaining agreements.
There is no unfair labor practice or employment discrimination or other
employment related complaint, grievance or proceeding against either of
CLEAR WIRE or against any person or entity with respect to any employee
of CLEAR WIRE pending or threatened before the National Labor Relations
Board or any federal, state, local or foreign governmental entity or
regulatory body. To the knowledge of CLEAR WIRE, there is no basis for
any such complaint, grievance or proceeding.
(d) CLEAR WIRE is in compliance in all material respects with all
applicable laws respecting employment and employment practices, terms
and conditions of employment and wages and hours. CLEAR WIRE has fully
complied with all applicable provisions of COBRA and has no obligations
with respect to any former employees qualifying beneficiaries
thereunder. CLEAR WIRE enjoys satisfactory relations with its
employees and agents.
3.23 Environmental, Health and Safety Matters. CLEAR WIRE is not in
violation of any applicable statute, law or regulation relating to the
environment or occupational safety and health, and no material
expenditures will be required in order to comply with any such statute,
law or regulation.
3.24 Absence of Certain Business Practices. CLEAR WIRE's directors,
officers, employees or agents nor any other person or entity or entity
acting on its or their behalf has, directly or indirectly, within the
past five (5) years given or agreed to give any gift or similar benefit
to any customer, supplier, governmental employee or other person or
entity or entity who is or may be in a position to help or hinder the
business of CLEAR WIRE or assist CLEAR WIRE in connection with any
actual or proposed transaction which (i) might subject either of CLEAR
WIRE to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, (ii) might have had a material adverse effect
on CLEAR WIRE if not given in the past or (iii) might materially
adversely affect the condition (financial or otherwise), business,
assets, liabilities, operations or prospects of CLEAR WIRE or which
might subject CLEAR WIRE to suit or penalty in any private or
governmental litigation or proceeding if not continued in the future.
3.25 Disclosure. Neither this Agreement nor any certificate delivered
in accordance with the terms hereof, or any document or statement in
writing which has been supplied by or on behalf of CLEAR WIRE or by any
of CLEAR WIRE's directors or officers, in connection with the
transactions contemplated hereby, contains any untrue statement of a
material fact, or omits any statement of a material fact necessary in
order to make the statements contained herein or therein not
misleading. There is no fact or circumstances known to CLEAR WIRE
which materially and adversely affects or which may materially and
adversely affect its business, prospects or financial condition or its
assets, which has not been set forth in this Agreement, certificates or
statements furnished in writing to ITFS in connection with the
transactions contemplated by this Agreement.
ARTICLE 4: REPRESENTATIONS AND WARRANTIES OF ITFS
ITFS represents and warrants to, and agrees with, CLEAR WIRE as
follows:
4.1 Organization. ITFS is a corporation duly organized, validly
existing and in good standing under the laws of Florida and has all
requisite corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted. ITFS
is duly qualified to do business and in good standing as a foreign
corporation in each jurisdiction in which the property owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification necessary. ITFS has heretofore delivered to CLEAR WIRE
true, accurate and complete copies of its Articles of Incorporation and
By-Laws as in effect on the date hereof and minutes of all meetings of
shareholders and directors of ITFS held through and including the date
of this Agreement. ITFS is not in violation of any of the provisions
of its Articles of Incorporation or By-Laws.
4.2 Authority Relative to this Agreement. ITFS has full corporate
power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the Board
of Directors of ITFS and except for approval of the shareholders of
ITFS, no other corporate proceedings are necessary to authorize this
Agreement or to consummate the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by ITFS and
constitutes a valid and binding agreement, enforceable against it in
accordance with its terms.
4.3 No Conflict; Required Filings and Consents.
(a) The execution and delivery of this Agreement by ITFS does not, and
the consummation of the transactions contemplated hereby will not, (i)
conflict with or violate any law, regulation, court order, judgment or
decree applicable to ITFS or by which its properties are bound or
affected, (ii) violate or conflict with either the Certificate of
Incorporation or By-Laws of ITFS or (iii) result in any breach of or
constitute a default (or an event which with notice or lapse of time or
both would become a default) under, or give to others any right of
termination or cancellation of, or result in the creation of a lien on
any of the properties of ITFS pursuant to any contract to which ITFS is
a party or by which ITFS or any of its respective properties is bound
or affected.
(b) ITFS is not required to submit any notice, report or other filing
with any governmental entity or regulating body, domestic or foreign,
in connection with the execution, delivery or performance of this
Agreement or the consummation of the transactions contemplated hereby.
No waiver, consent, approval or authorization of any governmental
entity or regulatory body, domestic or foreign, is required to be
obtained or made by ITFS in connection with its execution, delivery or
performance of this Agreement or the consummation of the transactions
contemplated hereby.
4.4 Capitalization.
(a) ITFS has authorized capital stock of 50,000,000 shares of common
stock, .001 par value, of which 24,939,916 shares are issued and
outstanding, fully paid and nonassessable and free of preemptive
rights, and ten million shares of preferred stock, of which no shares
will be issued and outstanding at the Effective Date, other than the
shares to be issued pursuant to this Agreement. None of the issued and
outstanding shares is the subject of any voting trust agreement or
other agreement relating to the vote thereof or restricting in any way
the sale or transfer thereof. All the outstanding shares of capital
stock of ITFS have been duly authorized and are validly issued, fully
paid and non-assessable. There are no options, warrants, conversion
rights, subscriptions or purchase rights of any nature to acquire from
ITFS, or commitments of ITFS to issue, shares of capital stock or other
securities are authorized, issued or outstanding, nor is ITFS obligated
in any other manner to issue shares or rights to acquire any of its
capital stock or other securities, other than the warrant referenced
and described in Appendix "B" to this Agreement. None of ITFS's
outstanding securities or authorized capital stock is subject to any
rights of redemption, repurchase, rights of first refusal, preemptive
rights or other similar rights, whether contractual, statutory or
otherwise, for the benefit of ITFS, any stockholder, or any other
person or entity. There are no restrictions on the transfer of shares
of capital stock of ITFS other than those imposed by relevant federal
and state securities laws and as otherwise contemplated by this
Agreement. There are no agreements, understandings, trusts or other
collaborative arrangements or understandings concerning the voting or
transfer of the capital stock of ITFS. The offer and sale of all
capital stock and other securities of ITFS issued before the date
hereof and to be issued hereafter complied with or were exempt or will
comply with or be exempt from all applicable federal and state
securities laws and no stockholder has a right of rescission or damages
with respect thereto. ITFS does not have outstanding, and has no
obligation to grant or issue, any "phantom stock" or other right
measured by the profits, revenues or results of operations of ITFS or
any portion thereof; or any similar rights.
4.5 Financial Statements.
(a) ITFS's balance sheets as of December 31, 200, December 31, 2001
and December 31, 2002 (the "ITFS Balance Sheets"), and the related
statements of income and retained earnings for the periods ending
December 31, 2000, December 31, 2001 and December 31, 2002 (the "ITFS
Financial Statements"), all certified by an independent certified
public accountant, copies of which have been delivered by ITFS to CLEAR
WIRE, fairly present the financial condition of ITFS as of said dates
and the results of its operations for the periods then ended, in
conformity with GAAP consistently applied for the periods covered. The
ITFS Financial Statements (x) were prepared in accordance with GAAP
applied on a consistent basis, (y) are in accordance with the books and
records of ITFS and (z) present fairly the financial position and
results of operations of ITFS at the dates and for the periods to which
they relate. ITFS has maintained its books of account in accordance
with GAAP applied on a consistent basis, and such books and records
are, and during the periods covered by the ITFS Financial Statements
were, correct and complete in all material respects, fairly and
accurately reflect and reflected the income, expenses, assets and
liabilities of ITFS, and provide and provided a fair and accurate basis
for the preparation of the ITFS Financial Statements and of the tax
returns and reports of ITFS.
(b) Except and as to the extent reflected in the ITFS Balance Sheets,
on December 31, 2002, ITFS did not have any direct or indirect
Liabilities, whether due or to become due, or arising out of
transactions entered into, or any state of facts existing, on or prior
to December 31, 2002 which would be required to be reflected on the
ITFS Interim Balance Sheet in accordance with GAAP.
4.6 Real and Personal Property. ITFS does not own or lease any real
property. ITFS has good and marketable title to, or valid leasehold
interests in, all other assets used or held for use in the conduct of
its business. All of the assets owned or leased by ITFS are in all
material respects in good condition and repair, ordinary wear and tear
excepted, and well maintained. There are no material capital
expenditures currently contemplated or necessary to maintain the
current business of ITFS. All of the assets of ITFS will be
distributed or disposed of prior to the Effective Date.
4.7 Absence of Undisclosed Liabilities. Except to the extent
reflected or reserved against in the ITFS Balance Sheets, ITFS does not
have at that date any liabilities or obligations (secured, unsecured,
contingent or otherwise) of a nature customarily reflected in a
corporate balance sheet prepared in accordance with generally accepted
accounting principles ("Liabilities").
4.8 Absence of Certain Changes. Since December 31, 2002 (i) there
has been no material adverse change in the condition (financial or
otherwise), assets, liabilities, results of operations, business or
prospects of ITFS, and (ii) nothing has occurred relative to the
business or prospects of ITFS which would have a material adverse
effect on the future business of ITFS. At the Effective Date, ITFS
will have liabilities secured by promissory notes payable on or before
September 20, 2003, totaling $175,000, payable to and on the terms
listed on Appendix "E" to this Agreement, which promissory notes will
be secured by the undertaking and obligation of ITFS and the Surviving
Corporation to issue additional shares of voting stock of the Surviving
Corporation to the persons named in Appendix "E" constituting voting
control of the Surviving Corporation in the event that the promissory
notes are not paid on a timely basis when due.
4.9 Litigation. No investigation or review by any governmental entity
or regulatory body, foreign or domestic, with respect to ITFS is
pending or threatened against ITFS, and no governmental entity or
regulatory body has advised ITFS of an intention to conduct the same.
There is no claim, action, suit, investigation or proceeding pending or
threatened against or affecting ITFS at law or in equity or before any
federal, state, municipal or other governmental entity or regulatory
body, or which challenges the validity of this Agreement or any action
taken or to be taken by ITFS pursuant to this Agreement. As of the
date hereof, ITFS is not subject to, nor is there in existence, any
outstanding judgment, award, order, writ, injunction or decree of any
court, governmental entity or regulatory body relating to ITFS.
4.10 Contracts. ITFS has provided, or prior to the Closing will
provide CLEAR WIRE, with all Contracts with respect to which ITFS is a
party. All such Contracts have been duly authorized and delivered, are
in full force and effect and constitute the valid and binding
obligations of the respective parties thereto enforceable in accordance
with their respective terms. As to such Contracts, (i) there are no
existing breaches or defaults by ITFS thereunder or, to the knowledge
of ITFS, by the other parties to such Contracts, (ii) no event, act or
omission has occurred or, as a result of the consummation of the
transactions contemplated hereby, will occur which (with or without
notice, lapse of time or the happening or occurrence of any other
event) would result in a default by ITFS thereunder or give cause for
termination thereof, provided that insofar as the foregoing
representation involves the actions or omissions of parties other than
ITFS, it shall be limited to the knowledge of ITFS, (iii) none of them
will result in any loss to ITFS upon completion or performance thereof
and (iv) none of the parties to Contracts have expressed an indication
to ITFS of their intention to cancel, renegotiate or exercise or not
exercise any option under any such Contracts.
4.11 Intellectual Property. ITFS does not own or use any Intellectual
Property rights. ITFS has not interfered with, infringed upon,
misappropriated, or otherwise come into conflict with any Intellectual
Property rights of third parties and ITFS has never received any
charge, complaint, claim, demand, or notice alleging any such
interference, infringement, misappropriation, or violation (including
any claim that ITFS must license or refrain from using any Intellectual
Property rights of any third party). No third party has interfered
with, infringed upon, misappropriated, or otherwise come into conflict
with any Intellectual Property rights of any of ITFS.
4.12 Licenses, Permits and Consents; Compliance with Applicable Law.
(a) ITFS possesses all licenses and permits which individually or in
the aggregate are material to the conduct of the business of ITFS under
applicable law or required by any federal, state, local or foreign
governmental entity or regulatory body for the operation of the
business of ITFS, and all of such listed licenses and permits are in
full force and effect as of the date hereof and will remain in full
force and effect following the consummation of the transactions
contemplated hereby. ITFS has not received notice and has no reason to
believe, that any appropriate authority intends to cancel or terminate
any of such licenses or permits or that valid grounds for such
cancellation or termination currently exist.
(b) ITFS is not in violation or breach of any, and the business and
operations of ITFS comply in all material respects and are being
conducted in accordance with, all governing laws, regulations and
ordinances applicable thereto and ITFS is not in violation of or in
default under any judgment, award, order, writ, injunction or decree of
any court, arbitration tribunal, governmental entity or regulatory
body.
4.13 Tax Matters. ITFS has timely filed all required federal, state,
local, foreign and other governmental Tax returns and reports required
to be filed by it for all taxable periods ending on or before the date
hereof, except that the 2002 federal and state income tax returns have
not yet been filed pursuant to an extension of time to file the returns
until September 15, 2003. As of the time of filing, such returns and
reports were true, complete and correct and were made on a proper
basis. All federal, state, local and foreign income, unincorporated
business, gross receipts, franchise, profits, property, capital,
intangibles, employment, excise or other taxes, fees, stamp taxes,
duties, penalties, assessments, governmental charges or other payments
(collectively "Tax" or "Taxes") for all periods up to and including the
date hereof have been duly paid or withheld or are, or will on the date
hereof be, adequately reserved for or withheld in accordance with GAAP
applied on a consistent basis.
4.14 Books and Records. The corporate minute books, stock certificate
books, stock registers and other corporate records of ITFS are correct
and complete in all material respects, and the signatures appearing on
all documents contained therein are the true signatures of the persons
purporting to have signed the same.
4.15 Disclosure. Neither this Agreement nor any certificate delivered
in accordance with the terms hereof, or any document or statement in
writing which has been supplied by or on behalf of ITFS or by any of
ITFS's directors or officers, in connection with the transactions
contemplated hereby, contains any untrue statement of a material fact,
or omits any statement of a material fact necessary in order to make
the statements contained herein or therein not misleading. There is no
fact or circumstances known to ITFS which materially and adversely
affects or which may materially and adversely affect its business,
prospects or financial condition or its assets, which has not been set
forth in this Agreement, certificates or statements furnished in
writing to CLEAR WIRE in connection with the transactions contemplated
by this Agreement.
4.16 Broker's or Finder's Fees. There is no investment banker,
broker, finder or other intermediary which has been retained by, or is
authorized to act on behalf of, ITFS who might be entitled to any fee
or commission from the Surviving Corporation upon the consummation of
the transactions contemplated hereby or thereafter except for Calvin
Jones and James Gramquist, pursuant to an agreement to pay each of them
$10,000 as a finders' fee on the closing of the Merger. These fees
will be assumed, paid and satisfied by the Surviving Corporation after
the effective date of the Merger and after the payment of the
promissory notes listed in Appendix "E" to this Agreement.
4.17 Entire Business. No business is conducted by third parties for
the benefit of ITFS. To the extent that ITFS may own any assets, all
such assets are exclusively owned or leased and used by ITFS.
ARTICLE 5: COVENANTS
5.1 Conduct of Business. From the date hereof to the Effective Time,
each of CLEAR WIRE and ITFS shall:
(a) conduct its business only in the ordinary course and in
substantially the same manner as heretofore conducted;
(b) maintain and keep its material properties and equipment in good
repair, working order and condition, except for ordinary wear and tear;
(c) use its best efforts to keep in full force and effect insurance
comparable in amount and scope of coverage to that now maintained by
it;
(d) perform in all material respects all of its obligations under all
Contracts applicable to its business or properties;
(e) use its best efforts to maintain and preserve its business
organization intact, retain its present employees so that they will be
available after the Effective Time, and maintain its relationships with
its customers so that they will be preserved after the Effective Time;
(f) Other than as contemplated by this Agreement, not change its
Articles of Incorporation or bylaws.
(g) Other than as contemplated by this Agreement, not make any change
in its authorized or issued capital stock, preferred stock or issue,
encumber, purchase or otherwise acquire any of its capital stock or
preferred stock other than as provided for in this Agreement.
5.2 Shareholders' Meeting. CLEAR WIRE will submit this Agreement to
its shareholders with a favorable recommendation by its Board of
Directors and will use its best efforts to obtain the requisite
shareholder approval. Under applicable Florida Corporation Law, ITFS
is not required to this Agreement to its shareholders for consideration
or approval.
5.4 Access to Information.
(a) Between the date of this Agreement and the Effective Date each of
the parties hereto shall give the other, their respective officers,
directors, financial advisors, counsel and other agents access to its
officers and to all of its books and records, permit them to make such
inspections as they may require and shall cause its officers, directors
and employees to furnish them with such financial and operating data
and other information with respect to their business and properties as
they from time to time reasonably request, and as may be necessary to
establish the performance of the covenants under this Agreement and the
accuracy of its representations and warranties herein, and in
connection with its preparation of any filing or submission to any
governmental entity or regulatory body.
(b) Each of CLEAR WIRE and ITFS shall hold, and shall use their best
efforts to cause their respective officers, directors, financial
advisors, counsel and other agents to hold, in strict confidence,
unless compelled to disclose by judicial or administrative process, or,
in the opinion of their counsel, by other requirements of law, all
documents and information concerning ITFS or CLEAR WIRE, as the case
may be, furnished to the other in connection with the transactions
contemplated by this Agreement (except to the extent that such
information can be shown to have been (i) in the public domain through
no fault of the disclosing party or any of its respective affiliates;
or (ii) later lawfully acquired without the breach of any other
agreement.
5.5 Best Efforts. Subject to the terms and conditions herein
provided, each of CLEAR WIRE and ITFS shall to use its best efforts to
take, or cause to be taken, all action, and to do, or cause to be done,
all things necessary, proper or advisable under applicable laws and
regulations, including to make all required submissions or filings with
governmental entities and regulatory bodies, to consummate and make
effective the transactions contemplated by this Agreement. If at any
time after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement, the proper
officers and directors of each party to this Agreement shall take all
such necessary action. CLEAR WIRE and ITFS will execute any additional
instruments necessary to consummate the transactions contemplate
hereby.
5.6 Consents. Each of ITFS and CLEAR WIRE shall use its or their best
efforts to obtain consents of all third parties, courts and
governmental entities and regulatory bodies necessary to consummate the
transactions contemplated by this Agreement.
5.7 Public Announcements. Each of ITFS and CLEAR WIRE will consult
with each other before issuing any press release or otherwise making
any public statement with respect to the Merger and shall not, except
as may be required by law or any listing agreements with any national
securities exchange, issue any such press release or make any such
public statement without the approval of ITFS and CLEAR WIRE.
5.8 Stock Options and Other Rights.
CLEAR WIRE has no outstanding Options to purchase common stock.
5.9 Litigation. From the date hereof through the Closing, CLEAR WIRE
and ITFS shall promptly notify the other of any actions or proceedings
that from the date hereof are threatened or commenced against CLEAR
WIRE or ITFS or the property or assets of ITFS or CLEAR WIRE, and of
any requests for additional information or documentary materials by any
governmental entity or regulatory body in connection with the
transactions contemplated hereby.
5.10 Continued Effectiveness of Representations and Warranties of
CLEAR WIRE and ITFS. From the date hereof until the Effective Time,
each of CLEAR WIRE and ITFS shall use their respective best efforts to
conduct their affairs in such a manner so that, except as otherwise
contemplated or permitted by this Agreement, the representations and
warranties contained in Articles 3 and 4 shall continue to be true and
correct on and as of the Effective Time as if made at the Effective
Time and CLEAR WIRE and ITFS shall promptly notify the other of any
event, condition or circumstance occurring from the date hereof through
the Effective Time that would constitute a material violation or breach
by ITFS or CLEAR WIRE of any of such representations and warranties.
5.11 Expenses. Whether or not the Merger is consummated, all expenses
incurred in connection with this Agreement and the Merger shall be the
obligation of the party incurring such expenses and not the Surviving
Corporation.
ARTICLE 6: CONDITIONS TO CONSUMMATION OF THE MERGER
6.1 Conditions to Obligations of Each Party. The respective
obligations of each party to effect the Merger are subject to the
satisfaction, at or prior to the Effective Time, of the following
conditions:
(a) This Agreement shall have been approved and adopted by the
requisite affirmative vote or written consent of the shareholders of
CLEAR WIRE and ITFS in accordance with applicable law.
(b) No statute, rule, regulation, executive order, decree, judgment or
injunction shall have been enacted, entered, promulgated or be in force
by any court or governmental authority which prohibits or restricts the
consummation of the Merger; provided, however, that the parties hereto
shall use their best efforts to have any such order, decree or
injunction vacated.
(c) The parties hereto shall have each delivered to the other,
financial statements and balance sheets as of the time periods
identified in Section 3.5 with respect to CLEAR WIRE and as of the year
ended in Section 4.5 with respect to ITFS (the "Financial
Statements").
6.2 Conditions to Obligations of CLEAR WIRE. CLEAR WIRE's obligation
to consummate the Merger shall be subject to fulfillment on or before
the Effective Time of each of the following conditions, unless waived
in writing by CLEAR WIRE:
(a) The representations and warranties of ITFS set forth in this
Agreement shall be true and correct in all material respects on the
date hereof and shall also be true and correct in all material respects
on and as at the Effective Time with the same force and effect as if
made on and as of the Effective Time, and ITFS shall have performed or
complied in all material respects with all agreements, conditions and
covenants required by this Agreement to be performed or complied with
by it on or before the Effective Time.
(b) ITFS shall have delivered to CLEAR WIRE a certificate of the
Secretary of ITFS certifying that the resolutions of the Board of
Directors and stockholders of ITFS previously delivered to CLEAR WIRE
authorizing the transactions contemplated hereby have not been revoked,
suspended or amended and remain in full force and effect and that this
Agreement has been approved and adopted by not less than a majority of
the stockholders of ITFS of each class entitled to vote on the Merger.
(c) CLEAR WIRE shall have received all documents it may reasonably
request relating to the existence of ITFS and the authority of ITFS to
enter into this Agreement and to consummate the transactions
contemplated hereby.
(d) All actions, proceedings, instruments and documents required to
carry out this Agreement and the transactions contemplated hereby, or
incidental hereto or thereto, and all other related legal matters shall
have been approved by legal counsel to CLEAR WIRE.
(e) All approvals, authorizations and consents required for ITFS to
consummate the Merger shall have been obtained on terms and conditions
satisfactory to CLEAR WIRE and shall be in full force and effect, and
CLEAR WIRE shall have been furnished with appropriate evidence,
reasonably satisfactory to it and its counsel of the granting of such
approvals, authorizations and consents.
(f) No objections to the merger and demands for payment of the fair
value thereof shall have been made in accordance with the provisions of
Florida or Texas law.
(g) There shall be no effective injunction, writ or preliminary
restraining order of any nature issued by a court or governmental
agency of competent jurisdiction directing that the transaction
provided for herein not be consummated as herein provided or which is
reasonably likely to have any material adverse effect on the condition
(financial or otherwise), assets, liabilities, results of operations,
business or prospects of ITFS.
(h) Since the date of the ITFS Balance Sheet there shall not have
been, and at the Effective Time there shall not be in existence, any
event, condition or state of facts which could reasonably be expected
to result in, any material adverse change in the condition (financial
or otherwise), assets, liabilities, results of operations, business or
prospects of ITFS except as otherwise provided in this Agreement, and
CLEAR WIRE shall have received a certificate of the President of ITFS
to the foregoing effect.
6.3 Additional Conditions to Obligations of ITFS. The obligations of
ITFS to effect the Merger are also subject to the following conditions:
(a) The representations and warranties of CLEAR WIRE contained in this
Agreement shall be true and correct in all material respects on the
date hereof and shall also be true and correct in all material respects
on and as at the Effective Time with the same force and effect as if
made on and as of the Effective Time, and CLEAR WIRE shall have per-
formed or complied in all material respects with all agreements,
conditions and covenants required by this Agreement to be performed or
complied with by them on or before the Effective Time.
(b) CLEAR WIRE shall have delivered to ITFS a certificate of the
Secretary of CLEAR WIRE certifying that (i) the resolutions of the
Board of Directors of CLEAR WIRE authorizing the transactions
contemplated hereby have not been revoked, suspended or amended and
remain in full force and effect, and (ii) this Agreement has been
approved and adopted by not less than a majority of the stockholders of
CLEAR WIRE of each class entitled to vote on the Merger.
(c) ITFS shall have received all documents they may reasonably request
relating to the existence of CLEAR WIRE and the authority of CLEAR WIRE
to enter into this Agreement and to consummate the transactions
contemplated hereby.
(d) All approvals, authorizations and consents required by CLEAR WIRE
to consummate the Merger shall have been obtained on terms and
conditions satisfactory to ITFS and shall be in full force and effect,
and ITFS shall have been furnished with appropriate evidence,
reasonably satisfactory to it and its counsel of the granting of such
approvals, authorizations and consents.
(e) No objections to the merger and demands for payment of the fair
value thereof shall have been made in accordance with the provisions of
Wyoming or Texas law.
(f) All options and warrants to purchase capital stock of CLEAR WIRE
shall have been cancelled, except as set forth in Section 1.7, and ITFS
shall have received assurances reasonably satisfactory to it that, at
and after the Effective Time, no holder of options or warrants will
have a right to any interest in the ITFS as a result of the exercise of
any such options or warrants.
(g) There shall be no effective injunction, writ or preliminary
restraining order of any nature issued by a court or governmental
agency of competent jurisdiction directing that the transaction
provided for herein not be consummated as herein provided or which is
reasonably likely to have any material adverse effect on the condition
(financial or otherwise), assets, liabilities, results of operations,
business or prospects of CLEAR WIRE.
(h) Since the date of the CLEAR WIRE Balance Sheet there shall not
have been, and at the Effective Time there shall not be in existence,
any event, condition or state of facts which could reasonably be
expected to result in, any material adverse change in the condition
(financial or otherwise), assets, liabilities, results of operations,
business or prospects of CLEAR WIRE, and ITFS shall have received a
certificate of the President of CLEAR WIRE to the foregoing effect.
ARTICLE 7: NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES
All statements contained herein or in any certificate, schedule or
other document delivered pursuant hereto shall be deemed
representations and warranties by the person delivering the same. All
representations and warranties shall survive the Effective Time and
shall not be affected by any investigation at any time made by or on
behalf of ITFS, on the one hand, or CLEAR WIRE, on the other hand.
ARTICLE 8: INDEMNIFICATION
(a) CLEAR WIRE hereby agrees to indemnify and hold harmless ITFS and
its affiliates from and against any liabilities, damages, losses,
claims, encumbrances, costs or expenses (including reasonable
attorneys' fees) of any nature (any or all of the foregoing are herein
referred to as "Loss") insofar as a Loss (or actions in respect
thereof), whether existing or accruing prior or subsequent to the
Effective Time, arises out of or is based upon any misrepresentation
(or alleged misrepresentation) or breach (or alleged breach) of any of
the warranties, covenants or agreements made by CLEAR WIRE in this
Agreement or in any certificate, schedule, document or Exhibit
referenced hereby or attached hereto.
(b) ITFS hereby agrees to indemnify and hold harmless CLEAR WIRE and
its affiliates from and against any Loss insofar as a Loss (or actions
in respect thereof), whether existing or accruing prior or subsequent
to the Effective Time, arises out of or is based upon any
misrepresentation (or alleged misrepresentation) or breach (or alleged
breach) of any of the warranties, covenants or agreements made by ITFS
in this Agreement or in any certificate, schedule, document or Exhibit
referenced hereby or attached hereto.
ARTICLE 9: TERMINATION; AMENDMENT; WAIVER
9.1 Termination. This Agreement and the transactions contemplated
hereby may be terminated at any time prior to the Closing:
(a) by mutual written agreement of CLEAR WIRE and ITFS;
(b) by ITFS or CLEAR WIRE, if (i) the transactions contemplated hereby
shall violate any non-appealable final order, decree or judgment of any
court or governmental body having competent jurisdiction or (ii) there
shall be a statute, rule or regulation which makes the transaction
contemplated hereby illegal or otherwise prohibited;
(c) By CLEAR WIRE, on the one hand, and ITFS and on the other hand if
the Merger is not consummated within ninety (90) days from the date
hereof; or
(d) by CLEAR WIRE, on the one hand, and ITFS on the other hand, in the
event the other makes a material misrepresentation or breaches a
covenant, agreement or warranty, but such non-misrepresenting or non-
breaching party's election to terminate shall not limit, waive or
prejudice such party's remedies at law or in equity.
(e) by CLEAR WIRE if the ITFS NASD security symbol (ITFI) is changed
or annotated to an "E" or "PK" or any other extension or delisted by
OTCBB at any time on or before closing. All periodic SEC filings that
are due within 30 days after execution of this Merger Agreement shall
be completed and provided to the Surviving Corporation on or before
closing.
In the event this Agreement is terminated as provided in Section
9.1(a), (b), (c), (d) or (e) this Agreement shall become void and of no
further force and effect and no party hereto shall have any further
liability to any other party hereto, except that Sections 5.4(b), 5.7
and 5.11 shall survive and continue in full force and effect
notwithstanding termination.
9.2 Amendment. This Agreement may be amended by action taken by ITFS
and CLEAR WIRE at any time before or after adoption of this Agreement
by the stockholders of CLEAR WIRE and ITFS but, after any such
approval, no amendment shall be made to this Agreement without the
approval of such stockholders which changes the terms of Section 1.3,
that alters or changes any term of the Articles of Incorporation of the
Surviving Corporation, or which alters or changes any of the terms and
conditions of this Agreement if such alteration or change would
adversely affect the rights of CLEAR WIRE's stockholders hereunder.
This Agreement may not be amended except by an instrument in writing
signed by or on behalf of the CLEAR WIRE and ITFS.
9.3 Extension; Waiver. At any time prior to the Effective Time, ITFS
or CLEAR WIRE may (i) extend the time for the performance of any of the
obligations or other acts of the other; (ii) waive any inaccuracies in
the representations and warranties contained herein or in any document,
certificate or writing delivered pursuant hereto or thereto; and (iii)
waive compliance with any of the agreements or conditions contained
herein. Any agreement on the part of any party to any such extension
or waiver shall be valid only if set forth in an instrument in writing
signed by or on behalf of such party.
ARTICLE 10: General Provisions
10.1 Entire Agreement. This Agreement constitutes the entire
agreement between the parties and supersedes and cancels any other
agreement, representation, or communication, whether oral or written,
between the parties hereto relating to the transactions contemplated
herein or the subject matter hereof.
10.2 Headings. The section and subsection headings in this Agreement
are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
10.3 Governing Law; Venue. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the Texas and
Florida without regard to conflict of laws.
10.4 Assignment. This Agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their successors and assigns;
provided, however, that any assignment by either party of its rights
under this Agreement without the written consent of the other party
shall be void.
10.5 Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
10.6 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given or made
as of the date delivered or mailed if delivered in person, by telecopy,
cable, telegram or telex, or by registered or certified mail (postage
prepaid, return receipt requested) to the respective parties as
follows:
if to ITFS:
Robert Hipple, CEO, International Trust & Financial Systems, Inc.
4232 D'Este Court, Lake Worth, FL 33467-4154
Telephone: 407-810-6125
Fax: 407-386-3074
e-mail: rjhipllc@aol.com
if to CLEAR WIRE:
Clear Wire Networks, Inc.
3225 Monette Lane
Plano, TX 75025
Telephone 972-208-0370
Facsimile 972-618-5047
or to such other address as the person to whom notices is given may
have previously furnished to the others in writing in the manner set
forth above.
10.7 Descriptive Headings; Table of Contents. The descriptive
headings herein are inserted for convenience of reference only and are
not intended to be part of or to affect the meaning or interpretation
of this Agreement. The Table of Contents preceding this Agreement is
not a part hereof.
10.8 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, its successors and
assigns.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the day and year first above written.
CLEAR WIRE NETWORKS, INC.,
a Texas corporation
/s/ John Shaunfield August 5, 2003
By:_________________________________ Date: ______________________
John Shaunfield, CEO
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
a Florida corporation
/s/ Robert Hipple August 5, 2003
By:_________________________________ Date: ______________________
Robert Hipple, CEO
APPENDIX "A"
to
AGREEMENT AND PLAN OF MERGER
Between
CLEAR WIRE NETWORKS, INC.
and
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
Dated
June 18, 2003
as amended
August 5, 2003
STATEMENT OF PREFERENCES OF PREFERRED SHARES
The voting, convertible preferred shares of the Surviving Corporation
issued to the shareholders of Clear Wire pursuant to Article 1.6(b) of
the Merger Agreement shall contain and be subject to a Statement of
Rights and Preferences adopted by the Board of Directors of the
Surviving Corporation containing the following:
1. The preferred shares shall be voting shares, voting with the issued
and outstanding common shares of the Surviving Corporation on all
matters with respect to which shareholders are entitled to vote under
applicable Florida law, and not as a separate class, except that each
share of the preferred stock shall have 40 votes, representing the
equivalent number of shares of common stock into which each share of
preferred stock is convertible.
2. The preferred shares shall be convertible, and shall be converted
into, the equivalent of 114,800,000 shares of the common stock, based
on the number of shares of common stock of the Surviving Corporation
issued and outstanding on the Effective Date, representing 69.3 percent
of the issued and outstanding common stock of the Surviving Corporation
after the Effective Date and after the conversion.
3. The conversion of the preferred shares shall occur automatically
upon the amendment of the Articles of Incorporation of the Surviving
Corporation to increase the number of shares of authorized common stock
to a number sufficient to issue common shares in conversion of the
preferred shares, after giving effect to any subsequent stock splits.
Notwithstanding the foregoing, the Surviving Corporation shall not
amend its Articles of Incorporation, change its domicile, issue
additional shares, or enter into any other merger or acquisition
agreement until such time as the promissory notes of ITFI referred to
in Appendix "E", which shall become the obligation of Altius as the
Surviving Corporation, are paid in full in accordance with their terms.
4. The preferred shares shall be deemed to be cancelled and no longer
issued and outstanding in the event that the promissory notes of ITFI
referred to in Appendix "E", which shall continue as the obligation of
Altius as the Surviving Corporation, are not paid in full in accordance
with their terms.
APPENDIX "B"
to
AGREEMENT AND PLAN OF MERGER
Between
CLEAR WIRE NETWORKS, INC.
and
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
Dated
June 18, 2003
as amended
August 5, 2003
DESCRIPTION OF OUTSTANDING ITFI WARRANT
Precom Technology, Inc., predecessor by name change to International
Trust & Financial Systems, Inc., issued a warrant to acquire one
million (1,000,000) shares of common stock of the Corporation at a
price of $2.00 per share to Greenwich Financial Group, Inc. of
Greenwich, CT. The Warrant was issued on April 16, 2002 and expires on
April 16, 2005. As a result of a subsequent 1 for 2 reverse split of
the common shares of Precom Technology, Inc., the Warrant automatically
adjusted and is now as Warrant to purchaser 500,000 shares of common
stock at $4.00 per share.
A copy of the Warrant and Warrant Agreement are attached to the March
30, 2002 Form 10-Q filed with the SEC.
APPENDIX "C"
to
AGREEMENT AND PLAN OF MERGER
Between
CLEAR WIRE NETWORKS, INC.
and
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
Dated
June 18, 2003
as amended
August 5, 2003
PREFERRED SHARES OF ALTIUS ISSUED TO CLEAR WIRE
Name Current CLEAR WIRE Number of Aged Altius
Shares Owned Preferred Shares to
be Issued
Vida Technologies, Inc. 100,000 1,000,000
Infinite Technology 100,000 1,000,000
Corporation, Inc.
John Shaunfield 20,000 200,000
Todd Grassi 20,000 200,000
David L. Pells 10,000 100,000
Tim B. Smith 10,000 100,000
Adnan Sardar 10,000 100,000
David Mathie 5,000 50,000
Gregory R. Basile 5,000 50,000
Carla J. Pells 5,000 50,000
The Structured Advantage 2,000 20,000
TOTAL 287,000 2,870,000
APPENDIX "D"
to
AGREEMENT AND PLAN OF MERGER
Between
CLEAR WIRE NETWORKS, INC.
and
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
Dated
June 18, 2003
as amended
August 5, 2003
CLEAR WIRE INTELLECTUAL PROPERTY AND LICENSES
Technology / Intellectual Property (IP) Reference Documents*
Circuit design technology and IP ITC/ALTIUS License Agreement,
licensed to Altius by Infinite dated July 17, 2002 and signed
Technology Corporation, Inc. by Tim Smith, CEO of ITC, and
Todd Grassi, President of
Altius/Clear Wire.
Fiber optic systems design technology VIDA/ALTIUS License Agreement,
and IP licensed to Altius by Vida dated July 17, 2002 and signed
Technologies, Inc. by Todd Grassi, President of
Vida Technologies, and Tim
Smith, Chairman of the Board of
Directors of Altius/Clear Wire.
* Incorporated by reference.
APPENDIX "E"
to
AGREEMENT AND PLAN OF MERGER
Between
CLEAR WIRE NETWORKS, INC.
and
INTERNATIONAL TRUST & FINANCIAL SYSTEMS, INC.
Dated
June 18, 2003
as amended
August 5, 2003
ITFI PROMISSORY NOTES TO BE PAID AFTER EFFECTIVE DATE
Note Holder Amount
Dana L. Hipple $ 74,000
American Pension Services as Administrator
For IRA of Robert Hipple $ 30,000
Robert Hipple $ 30,000
Glenn Liddell $ 41,000
Total $175,000
Each promissory note is dated August 5, 2003 and is payable, without
interest, on or before September 20, 2003. In the event that each
promissory note is not paid by ITFS or its successor, Altius Technology
Corporation, on or before September 20, 2003, then the Series "A"
preferred stock of ITFS issued pursuant to the Merger Agreement shall
be deemed to be cancelled, ITFS and Altius, as the Surviving
Corporation, shall issue an additional 5,000,000 (pre-split) or an
equivalent number of post-split, shares of Common Stock of Altius
proportionately to the Note Holders, and the shares to be issued to The
Hubinger Organization pursuant to Article 1.6(c) of the Merger
Agreement shall not be issued. In addition, the 287,000 shares of
Clear Wire common stock transferred to ITFS at closing shall be
reconveyed to the shareholders listed on Appendix "C", and any persons
appointed or elected as directors and officers of Altius after the
closing shall resign as officers and directors of the Surviving
Corporation.
At closing, Altius, through its duly elected officers and directors,
shall execute and deliver to the Note Holders written instructions
dated September 20, 2003, to the Transfer Agent to issue the additional
5,000,000 shares (or equivalent number of post-split shares), to be
delivered to the Transfer Agent on September 21, 2003 if the full
amount of the Notes is not paid on or before September 20, 2003. The
existing Transfer Agent of ITFS shall not be changed until the
promissory notes are paid in full. In addition, the Statement of
Rights and Preferences of the Convertible, Voting Preferred Stock,
issued to the shareholders of Clear Wire in the merger, shall provide
that the shares shall be deemed automatically to be cancelled and shall
be non-voting, non-convertible preferred shares until cancelled on the
books of the Surviving Corporation, in the event that the full
principal balance of the Notes is not paid on or before September 20,
2003.
ARTICLES OF MERGER
The following articles of merger are being submitted in accordance with
section 607.1109, Florida Statutes this 13th day of August, 2003.
FIRST: The exact name, street address of its principal office,
jurisdiction, and entity type for each merging party are as follows:
Name and Address Jurisdiction Entity Type
International Trust Florida Corporation
& Financial Systems, Inc.
4232 D'Este Court
Lake Worth, FL 33467
Florida Document/Registration Number: P96000074784
FEI Number: 90-0069585
Name and Address Jurisdiction Entity Type
Clear Wire Networks, Inc. Texas Corporation
1024 S. Greenville Ave, Suite 240
Allen, Texas 75002
FEI Number: 01-0601247
SECOND: The exact name, street address of its principal office,
jurisdiction, and entity type of the surviving party are as follows:
Name and Address Jurisdiction Entity Type
International Trust Florida Corporation
& Financial Systems, Inc.
4232 D'Este Court
Lake Worth, FL 33467
THIRD: The attached Agreement and Plan of Merger meets the
requirements of Section 607.1108, Florida Statutes, and was approved by
each domestic corporation that is a party to the merger in accordance
with Chapter 607, Florida Statutes.
FOURTH: If applicable, the attached Plan of Merger was approved by the
other business entity that is a party to the merger in accordance with
the respective laws of all applicable jurisdictions.
FIFTH: The merger is permitted under the respective laws of all
applicable jurisdictions and is not prohibited by the agreement of any
partnership or limited partnership or the regulations or articles of
organization of any limited liability company that is a party to the
merger.
SIXTH: The merger shall become effective as of the date the Articles of
Merger are filed with the Florida Department of State.
SEVENTH: The Articles of Merger comply and were executed in accordance
with the laws of each party's applicable jurisdiction.
EIGHTH: SIGNATURE FOR EACH PARTY:
INTERNATIONAL TRUST & CLEAR WIRE NETWORKS, INC.
FINANCIAL SYSTEMS, INC.
/s/ Robert Hipple /s/ John Shaunfield
_________________________ ________________________
Robert Hipple, CEO John Shaunfield, CEO
ARTICLES OF MERGER
Pursuant to the provisions of article 5.04 of the Texas Business
Corporation Act, the undersigned corporations certify the following
articles of merger, adopted on August 13, 2003, for the purpose of
effecting a merger in accordance with the provisions of Part Five of
the Texas Business Corporation Act.
1. The name of each of the undersigned corporations that are a party to
the plan of merger or that are to be created by the plan of merger, the
type of such corporation and the laws under which such corporation is
organized are:
Name of Corporation Type of Entity State
Clear Wire Networks, Inc. Corporation Texas
International Trust & Financial Systems Inc Corporation Florida
2. A plan of merger was approved and adopted in accordance with the
provisions of article 5.03 of the Texas Business Corporation Act
providing for the combination of Clear Wire Networks, Inc. and
International Trust & Financial Systems, Inc. resulting in
International Trust & Financial Systems, Inc. as the surviving
corporation.
3. An executed copy of the plan of merger is on file at the principal
place of business of International Trust & Financial Systems, Inc.,
4232 D'Este Court Lake Worth, FL 33467 and a copy of the plan of merger
will be furnished by such entity, on written request and without cost,
to any shareholder of each domestic corporation that is a party to or
created by the plan of merger and to any creditor or obligee of the
parties to the merger at the time of the merger if such obligation is
then outstanding.
4. No amendments to the articles of incorporation of any domestic
surviving corporation are to be effected by the merger.
5. As to each of the undersigned domestic corporations, the approval of
whose shareholders is required, the number of outstanding shares of
each class or series of stock of such corporation entitled to vote,
with other shares or as a class, on the Plan of Merger are as follows:
Number of Shares Class or
Name of Corporation Outstanding Series
Clear Wire Networks, Inc. 287,000 Common
6. As to each of the undersigned domestic corporations, the approval of
whose shareholders is required, the number of shares, not entitled to
vote only as a class, voted for and against the plan of merger,
respectively, are as follows:
Total Voted Total Voted Class or Series
Name of Corporation For Against
Clear Wire Networks, 287,000 0 Common
Inc.
7. The attached Agreement and Plan of Merger and the performance of its
terms were duly authorized by all action required by the laws under
which each foreign corporation that is a party to the merger was
incorporated or organized and by its constituent documents.
8. The merger will become effective upon the issuance of the
certificate of merger by the secretary of state in accordance with
article 5.05 of the Texas Business Corporation Act,
Dated August 13, 2003.
INTERNATIONAL TRUST & CLEAR WIRE NETWORKS, INC.
FINANCIAL SYSTEMS, INC.
/s/ Robert Hipple /s/ John Shaunfield
_________________________ ________________________
Robert Hipple, CEO John Shaunfield, CEO