<PAGE>
Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
EYE DYNAMICS, INC.,
ORTHONETX, INC.
AND
EYE DYNAMICS ACQUISITION CORP.
This AGREEMENT AND PLAN OF MERGER (this "Agreement") is made
and
entered into as of September 1, 2005 among
Eye Dynamics, Inc., a Nevada
corporation ("Parent"), OrthoNetx, Inc., a
Nevada corporation ("OrthoNetx"), and
Eye Dynamics Acquisition Corp., a Nevada
corporation and a wholly-owned
subsidiary of Parent ("EYDY Merger
Sub").
EXPLANATORY STATEMENT
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A. Upon the terms and subject to the conditions of this Agreement
and
in accordance with the Nevada Revised
Statutes ("NRS"), Parent, OrthoNetx and
EYDY Merger Sub intend to enter into a
business combination transaction.
B. The Board of Directors of OrthoNetx (i) has determined that
the
Merger (as defined in Section 1.2 below) is
consistent with and in furtherance
of the long-term business strategy of
OrthoNetx and fair to, and in the best
interests of, OrthoNetx and its
stockholders, (ii) has approved this Agreement,
the Merger and the other transactions
contemplated by this Agreement, (iii) has
adopted a resolution declaring the Merger
advisable, and (iv) has determined to
recommend that the stockholders of
OrthoNetx adopt this Agreement.
C. The Board of Directors of Parent (i) has determined that the
Merger
is consistent with and in furtherance of
the long-term business strategy of
Parent and fair to, and in the best
interests of, Parent and its stockholders,
(ii) has approved this Agreement, the
Merger and the other transactions
contemplated by this Agreement, (iii) has
adopted a resolution declaring the
Merger advisable, and (iv) has approved the
issuance of shares of Parent Common
Stock (as defined below) pursuant to the
Merger (the "Share Issuance").
D. The Board of Directors of EYDY Merger Sub (i) has determined
that
the Merger is consistent with and in
furtherance of the long-term business
strategy of EYDY Merger Sub, and fair to
and in the best interests of, EYDY
Merger Sub and its stockholders, (ii) has
approved this Agreement, the Merger
and the other transactions contemplated by
this Agreement, (iii) has adopted a
resolution declaring the Merger advisable,
and (iv) has determined to recommend
that the sole stockholder of EYDY Merger
Sub adopt this Agreement.
NOW, THEREFORE, in consideration of the foregoing Explanatory
Statement
that is made a substantive part of this
Agreement and the covenants, promises
and representations set forth herein, and
for other good and valuable
consideration, the receipt and sufficiency
of which are hereby acknowledged, the
parties agree as follows:
<PAGE>
ARTICLE I
THE MERGER
1.1 THE MERGER. At the Effective Time (as defined in Section
1.2
hereof) and subject to and upon the terms
and conditions of this Agreement and
the applicable provisions of the NRS, EYDY
Merger Sub shall be merged with and
into OrthoNetx (the "Merger"), the separate
corporate existence of EYDY Merger
Sub shall cease and OrthoNetx shall
continue as the surviving corporation and
shall become a wholly-owned subsidiary of
Parent. The surviving corporation
after the Merger is sometimes referred to
hereinafter as the "OrthoNetx
Surviving Corporation."
1.2 EFFECTIVE TIME. Unless this Agreement is earlier terminated
pursuant to Article VII hereof, the closing
of the Merger and the other
transactions contemplated by this Agreement
(the "Closing") will take place at
the offices of OrthoNetx, at a time and
date to be specified by the parties, but
in no event later than two (2) business
days following satisfaction or waiver of
the conditions set forth in Article VI
hereof. The date upon which the Closing
actually occurs is herein referred to as
the "Closing Date." On the Closing
Date, the parties hereto shall cause the
Merger to be consummated by filing
Articles of Merger or like instrument
("Articles of Merger") with the Secretary
of State of the State of Nevada, in
accordance with the relevant provisions of
Nevada Law (the times at which the Merger
has become fully effective (or such
later time as may be agreed in writing by
OrthoNetx and specified in the
Articles of Merger) is referred to herein
as the "Effective Time").
1.3 EFFECT OF THE MERGER.
(a) At the Effective Time, the effect of the Merger shall be
as provided in the applicable provisions of
Nevada Law. Without limiting the
generality of the foregoing, and subject
thereto, at the Effective Time, except
as provided herein, all the property,
rights, privileges, powers and franchises
of OrthoNetx and EYDY Merger Sub shall vest
in the OrthoNetx Surviving
Corporation, and all debts, liabilities and
duties of OrthoNetx and EYDY Merger
Sub shall become the debts, liabilities and
duties of the OrthoNetx Surviving
Corporation.
(b) Prior to or at the Effective Time, the properties and
assets of Parent and its Subsidiaries (as
defined in Section 2.1) will be free
and clear of any and all encumbrances,
charges, claims equitable interests,
liens, options, pledges, security
interests, mortgages, rights of first refusal
or restrictions of any kind and nature
(collectively, the "Encumbrances"),
except for such liabilities, accounts
payable, debts, adverse claims, duties,
responsibilities and obligations of every
kind or nature, whether accrued or
unaccrued, known or unknown, direct or
indirect, absolute, contingent,
liquidated or unliquidated and whether
arising under, pursuant to or in
connection with any contract, tort, strict
liability or otherwise (collectively
the "Liabilities") of Parent which shall be
set forth in SCHEDULE 3.5 attached
hereto.
(c)
Promptly following the Effective Time, subject to
stockholder approval, it is expected that
Parent will change its name to
"AcuNetx, Inc."
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1.4 ARTICLES OF INCORPORATION; BYLAWS.
(a) Unless otherwise determined by OrthoNetx prior to the
Effective Time, at the Effective Time, the
Articles of Incorporation of
OrthoNetx as in effect immediately prior to
the Effective Time shall be the
Articles of Incorporation of the OrthoNetx
Surviving Corporation at and after
the Effective Time until thereafter amended
in accordance with the Nevada Law
and the terms of such Articles of
Incorporation.
(b) Unless otherwise determined by OrthoNetx prior to the
Effective Time, (i) the Bylaws of OrthoNetx
as in effect immediately prior to
the Effective Time shall be the Bylaws of
the OrthoNetx Surviving Corporation at
and after the Effective Time, until
thereafter amended in accordance with Nevada
Law and the terms of Articles of
Incorporation of the OrthoNetx Surviving
Corporation and such Bylaws.
1.5 ORTHONETX DIRECTORS AND OFFICERS.
(a) Unless otherwise determined by OrthoNetx prior to the
Effective Time, the directors of OrthoNetx
immediately prior to the Effective
Time shall be the directors of the
OrthoNetx Surviving Corporation and at and
after the Effective Time, each to hold the
office of a director of the OrthoNetx
Surviving Corporation in accordance with
the provisions of Nevada Law and the
Articles of Incorporation and Bylaws of the
OrthoNetx Surviving Corporation
until their successors are duly elected and
qualified.
(b) Unless otherwise determined by OrthoNetx prior to the
Effective Time, the officers of OrthoNetx
immediately prior to the Effective
Time shall be the officers of the OrthoNetx
Surviving Corporation at and after
the Effective Time, each to hold office in
accordance with the provisions of the
Bylaws of the OrthoNetx Surviving
Corporation.
1.6 EFFECT ON CAPITAL STOCK. Subject to the terms and conditions
of
this Agreement, at the Effective Time, by
virtue of the Merger and without any
action on the part of Parent, OrthoNetx and
EYDY Merger Sub or the holders of
any of the following securities, the
following shall occur:
(a) FINAL DISTRIBUTION OF PARENT SECURITIES. Immediately after
the
Effective Time, and conditioned on Closing,
the Securities of Parent will be
owned in the following proportions: 46.25%
owned by shareholders, option holders
and warrant holders of EYDY (collectively
"EYDY Stockholders") as of August 26,
2005; 46.25% owned by shareholders, option
holders, and warrant holders of
OrthoNetx (collectively "Holders of
OrthoNetx Core Securities" as further
defined in Section 1.6(b)); and 7.5% owned
by Galen Capital Group, LLC and its
designees ("Galen").
Whereas the total number of Common Shares,
outstanding options and warrants of
Parent as of Effective Time equals
22,479,879 shares (21,674,880 Common Shares,
405,000 options and 399,999 warrants), the
numerical distribution of Parent
Securities at the Effective Time shall be
as follows:
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<TABLE>
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OWNERS OF PARENT SECURITIES AT CLOSING
Parent Securities
%
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<S>
<C>
<C>
EYDY STOCKHOLDERS (includes 405,000 Board
options 22,479,879
common shares,
options, and
46.25%
and 399,999 warrants collectively owned by
Donald warrants combined
Hall, Frank P. Tota and Frank Tota,
Sr.)
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HOLDERS OF ORTHONETX CORE SECURITIES
(excludes
22,479,879 common shares, options, and
46.25%
OrthoNetx common shares to be issued at the
Effective
warrants combined
Time to Galen to equal7.5% ownership of
Parent
pursuant to Section 1.6(e), and excludes
399,999
warrants to purchase OrthoNetx common
shares to be
issued at the Effective Time collectively
to Donald
Hall, Frank P. Tota and Frank Tota, Sr.
pursuant to
Section 1.6(f))
------------------------------------------------------
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GALEN
3,645,386 common shares
7.50%
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PARENT TOTAL AT EFFECTIVE TIME 48,605,144 common shares, options, and
100%
warrants combined
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</TABLE>
To achieve these proportions and to effect
the intent of this Agreement,
OrthoNetx, Galen and certain holders of
warrants of EYDY will receive Parent
Securities according to a Conversion Factor
(the "Conversion Factor") applied
uniformly to all holders of OrthoNetx
Securities at the Effective Time, and
under the conditions enumerated in Sections
1.6(b-h) that follow.
(b) CONVERSION OF ORTHONETX CORE SECURITIES. The "OrthoNetx
Core Securities" are defined as all shares
of OrthoNetx Common Stock, par value
$0.001 per share, and all pre-merger
options and warrants of OrthoNetx issued
and outstanding immediately prior to the
Effective Time, and EXCLUDING 1,200,000
OrthoNetx common shares held by or on
behalf of Galen and the additional
OrthoNetx common shares to be issued to
Galen necessary to equal 7.5% of Parent
Securities at the Effective Time, and
EXCLUDING 399,999 EYDY warrants to be
exchanged for OrthoNetx warrants at the
Effective Time. The aggregate shares of
Parent Common Stock and options and
warrants of Parent to be exchanged for the
OrthoNetx Core Securities are referred to
in this Agreement as the "EYDY Merger
Consideration." The OrthoNetx Core
Securities will be automatically converted at
the Effective Time (subject to Sections
1.6(g)) into shares of Parent Common
Shares, $0.001 par value per share, and
options and warrants of Parent (the
"Parent Common Stock") using the Conversion
Factor. The Conversion Factor will
be calculated at the Effective Time using
the EYDY Merger Consideration as the
numerator and the OrthoNetx Core Securities
as the denominator. (By way of
example, as of the Effective Time, the
OrthoNetx Core Securities are expected to
equal 26,160,353. The Conversion Factor
would then be 22,479,879 / 26,160,353 =
0.859311.) This method assures that owners
of OrthoNetx Core Securities will
receive 22,479,879 shares of Parent Common
Stock and options and warrants of
Parent (other than shares held by holders
who have not consented to and approved
the adoption of this Agreement in writing
and who qualify under and have
complied with all of the provisions of
Section 92A.380 of the NRS).
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All of the foregoing percentage ownerships exclude the
OrthoNetx Common Stock and warrants to be
issued to investors in the September
1, 2005 private placement offering of up to
$3,000,000 of the securities of
OrthoNetx with all funds held in escrow as
set forth in Section 6.1(e) below. If
any shares of OrthoNetx Common Stock
outstanding immediately prior to the
Effective Time are unvested or are subject
to a repurchase option, risk of
forfeiture or other condition under any
applicable restricted stock purchase
agreement or other agreement with
OrthoNetx, then the shares of Parent Common
Stock issued in exchange for such shares of
OrthoNetx Common Stock will also be
unvested and subject to the same repurchase
option, risk of forfeiture or other
condition, and the certificates
representing such shares of Parent Common Stock
may accordingly be marked with appropriate
legends.
(c) ORTHONETX STOCK OPTIONS. At the Effective Time, all
options to purchase OrthoNetx Common Stock
then outstanding under OrthoNetx's
2005 Stock Option Plan (the "OrthoNetx
Option Plan") and the OrthoNetx Option
Plan itself shall be assumed by Parent in
accordance with Section 5.4(a) hereof.
(d) ORTHONETX WARRANTS. At the Effective Time, all warrants to
purchase OrthoNetx Common Stock then
outstanding shall be assumed by Parent, and
shall become exercisable for shares of
Parent Common Stock in accordance with
Section 5.4(b) hereof.
(e) ISSUANCE OF ADDITIONAL ORTHONETX COMMON STOCK TO GALEN AND
CONVERSION OF ORTHONETX COMMON STOCK HELD
BY GALEN TO PARENT COMMON STOCK.
OrthoNetx, immediately prior to Closing,
shall issue to or on behalf of Galen
that number of shares of OrthoNetx Common
Stock that, together with shares of
OrthoNetx Common Stock previously held by
or on behalf of Galen (1,200,000
common shares), that upon applying the
Conversion Factor will equal 7.5%
(3,645,386 shares) of the Parent Common
Stock upon conversion to Parent Common
Stock at Closing.
(f) EXCHANGE OF CERTAIN EYDY WARRANTS FOR ORTHONETX WARRANTS,
CONVERSION OF SAID ORTHONETX WARRANTS TO
ORTHONETX COMMON SHARES, AND CONVERSION
OF SAID ORTHONETX COMMON SHARES TO PARENT
COMMON SHARES. EYDY and OrthoNetx
agree that, immediately prior to Closing,
EYDY warrants currently held by Donald
E. Hall, Frank P. Tota and Frank Tota, Sr.
(collectively the "Hall Warrants")
representing an aggregate of 399,999 shares
included within the EYDY Common
Stock totaling 22,479,879 as of August 26,
2005. At the Effective Time, the Hall
Warrants will be exchanged for OrthoNetx
warrants at the same exercise price.
The number of OrthoNetx warrants issued on
exchange of the Hall Warrants will be
such that on conversion to OrthoNetx Common
Shares and then applying the
Conversion Factor, 399,999 shares of Parent
Common Shares will be issued pro
rata to the owners of the Hall Warrants at
Closing.
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5
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(g) ADJUSTMENTS TO EYDY MERGER CONSIDERATION. Except as
described in Section 1.8, the EYDY Merger
Consideration shall be adjusted to
reflect appropriately the effect of any
stock split, reverse stock split, stock
dividend (including any dividend or
distribution of securities convertible into
or exercisable or exchangeable for Parent
Common Stock, OrthoNetx Common Stock),
reorganization, recapitalization,
reclassification, combination, exchange of
shares or other like change with respect to
Parent Common Stock, OrthoNetx
Common Stock occurring or having a record
date on or after the date hereof and
prior to the Effective Time.
(h) FRACTIONAL SHARES. No fraction of a share of Parent Common
Stock will be issued by virtue of the
Merger. In lieu thereof any fractional
share will be rounded to the nearest whole
share of Parent Common Stock (with .5
being rounded up).
1.7 SURRENDER OF CERTIFICATES.
(a) PARENT TO PROVIDE COMMON STOCK. Promptly after the
Effective Time, Parent shall make available
in accordance with this Article I,
the shares of Parent Common Stock issuable
pursuant to Section 1.6(a) in
exchange for outstanding shares of
OrthoNetx Common Stock.
(b) EXCHANGE PROCEDURES. Promptly after the Effective Time,
Parent shall mail to each holder of record
as of the Effective Time of a
certificate or certificates, which
immediately prior to the Effective Time
represented outstanding shares of OrthoNetx
Common Stock (the "Certificates")
(i) a letter of transmittal in customary
form, which shall specify that delivery
shall be effected, and risk of loss and
title to the Certificates shall pass,
only upon delivery of the Certificates to
the Parent, and (ii) instructions for
use in effecting the surrender of the
Certificates in exchange for certificates
representing shares of Parent Common Stock
pursuant to Section 1.6(a). Upon
surrender of Certificates for cancellation
to the Parent, together with such
letter of transmittal, duly completed and
validly executed in accordance with
the instructions thereto, the holders of
such Certificates shall be entitled to
receive in exchange therefor certificates
representing the number of whole
shares of Parent Common Stock into which
their shares of OrthoNetx Common Stock
were converted pursuant to Section 1.6(a),
and the Certificates so surrendered
shall forthwith be cancelled. Until so
surrendered, outstanding Certificates
will be deemed, from and after the
Effective Time, to evidence only the
ownership of the number of whole shares of
Parent Common Stock into which such
shares of OrthoNetx Common Stock shall have
been so converted (including any
voting, notice or other rights associated
with the ownership of such shares of
Parent Common Stock under the Articles of
Incorporation or Bylaws of Parent or
under the NRS).
(c) TRANSFERS OF OWNERSHIP. If certificates representing
shares of Parent Common Stock are to be
issued in a name other than that in
which the Certificates surrendered in
exchange therefor are registered, it will
be a condition of the issuance thereof that
the Certificates so surrendered will
be properly endorsed and otherwise in
proper form for transfer and that the
persons requesting such exchange will have
(i) paid to Parent or any agent
designated by it any transfer or other
taxes required by reason of the issuance
of certificates representing shares of
Parent Common Stock in any name other
than that of the registered holder of the
Certificates surrendered, or (ii)
established to the satisfaction of Parent
or any agent designated by it that
such tax has been paid or is not
payable.
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6
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(d) REQUIRED WITHHOLDING. Each of the Parent and OrthoNetx
Surviving Corporation shall be entitled to
deduct and withhold from any
consideration payable or otherwise
deliverable pursuant to this Agreement to any
holder or former holder of OrthoNetx Common
Stock such amounts as may be
required to be deducted or withheld
therefrom under the United States Internal
Revenue Code of 1986, as amended, (the
"Code") or state, local or foreign tax
law. To the extent such amounts are so
deducted or withheld, such amounts shall
be treated for all purposes under this
Agreement as having been paid to the
person to whom such amounts would otherwise
have been paid.
(e) NO LIABILITY. Notwithstanding anything to the contrary in
this Section 1.7, neither the Parent nor
the OrthoNetx Surviving Corporation nor
any party hereto shall be liable to a
holder of shares of Parent Common Stock or
OrthoNetx Common Stock for any amount
properly paid to a public official
pursuant to any applicable abandoned
property, escheat or similar law.
1.8 NO FURTHER OWNERSHIP RIGHTS IN ORTHONETX COMMON STOCK. All
shares
of Parent Common Stock issued in accordance
with the terms hereof shall be
deemed to have been issued in full
satisfaction of all rights pertaining to such
shares of OrthoNetx Common Stock. After the
Effective Time, there shall be no
further registration of transfers on the
records of the OrthoNetx Surviving
Corporation of shares of OrthoNetx Common
Stock which were outstanding
immediately prior to the Effective Time.
If, after the Effective Time,
Certificates are presented to the OrthoNetx
Surviving Corporation for any
reason, they shall be cancelled and
exchanged as provided in this Article I.
1.9 LOST, STOLEN OR DESTROYED CERTIFICATES. In the event that
any
Certificates shall have been lost, stolen
or destroyed, the Parent shall issue
and pay in exchange for such lost, stolen
or destroyed Certificates, upon the
making of an affidavit of that fact by the
holder thereof, certificates
representing the shares of Parent Common
Stock into which the shares of
OrthoNetx Common Stock represented by such
Certificates were converted pursuant
to Section 1.6(a); provided, however, that
the Parent may, in its discretion and
as a condition precedent to the issuance of
such certificates representing
shares of Parent Common Stock require the
owner of such lost, stolen or
destroyed Certificates to deliver a bond in
such sum as it may reasonably direct
as indemnity against any claim that may be
made against Parent or the OrthoNetx
Surviving Corporation with respect to the
Certificates alleged to have been
lost, stolen or destroyed.
1.10 TAX TREATMENT. It is intended by the parties hereto that
the
Merger shall constitute a reorganization
within the meaning of Section 368(a) of
the Code. Each of the parties hereto adopts
this Agreement as a "plan of
reorganization" within the meaning of
Sections 1.368-2(g) and 1.368-3(a) of the
United States Treasury Regulations (the
"Regulations"). Both prior to and after
the Closing, each party's books and records
shall be maintained, and all
federal, state and local income tax returns
and schedules thereto shall be filed
in a manner consistent with the Merger
being qualified as a reverse triangular
merger under Section 368(a)(2)(E) of the
Code (and comparable provisions of any
applicable state or local laws).
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1.11
TAKING OF NECESSARY ACTION; FURTHER ACTION. If, at any time
after
the Effective Time, any further action is
necessary or desirable to carry out
the purposes of this Agreement and to vest
the OrthoNetx Surviving Corporation
(and/or its successor in interest) with
full right, title and possession to all
assets, property, rights, privileges,
powers and franchises of OrthoNetx and
EYDY Merger Sub, the officers and directors
of Parent and the OrthoNetx
Surviving Corporation shall be fully
authorized (in the name of EYDY Merger Sub,
OrthoNetx and otherwise) to take all such
necessary action.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF ORTHONETX
Except as set forth in the corresponding sections or subsections of
the
letter of exceptions delivered to Parent by
OrthoNetx on or prior to entering
into this Agreement and incorporated herein
by this reference (the "OrthoNetx
Schedule"), OrthoNetx hereby represents and
warrants to Parent and EYDY Merger
Sub that:
2.1 ORGANIZATION OF ORTHONETX.
(a) OrthoNetx is a corporation duly organized, validly
existing and in good standing under the
laws of Nevada; has the corporate power
and authority to own, lease and operate its
assets and property and to carry on
its business as now being conducted; and is
duly qualified to do business and in
good standing as a foreign corporation in
each jurisdiction in which the failure
to be so qualified would have an OrthoNetx
Material Adverse Effect. As used in
this Agreement, the term (i) "Subsidiary"
means the subsidiaries of OrthoNetx
set forth in Section 2.1 of the OrthoNetx
Schedule and (ii) "OrthoNetx Material
Adverse Effect" means a material adverse
effect on the condition (financial or
otherwise), business, assets or results of
operations of OrthoNetx and its
Subsidiaries as a whole, or on the ability
of OrthoNetx to consummate the
transactions contemplated by this
Agreement; it being understood, however, that
OrthoNetx's continuing incurrence of
losses, as long as such losses are in the
ordinary course of business shall not,
alone, be deemed to be an OrthoNetx
Material Adverse Effect.
(b) Except as reflected on the OrthoNetx Schedule, OrthoNetx
owns, without any liens or encumbrances,
all of the business assets, rights,
patents and other tangible and intangible
assets as described in OrthoNetx's
private placement memorandum dated August
26, 2005.
(c) OrthoNetx has delivered to Parent a true and complete list
of all of OrthoNetx's Subsidiaries,
indicating the jurisdiction of incorporation
of each Subsidiary and OrthoNetx's equity
interest therein.
(d) OrthoNetx has delivered or made available to Parent a true
and correct copy of the Articles of
Incorporation and Bylaws of OrthoNetx and
similar governing instruments of each of
its Subsidiaries, each as amended to
date, and each such instrument is in full
force and effect. Neither OrthoNetx
nor any of its Subsidiaries is in violation
of any of the provisions of its
Certificate of Incorporation or Bylaws or
equivalent governing instruments.
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2.2 ORTHONETX CAPITAL STRUCTURE. The authorized capital stock
of
OrthoNetx consists of 100,000,000 shares of
Common Stock, par value $0.001 per
share, of which there were 26,160,353
shares issued and outstanding as of August
26, 2005 assuming all securities sold in
the OrthoNetx $500,000 bridge
financing. All outstanding shares of
OrthoNetx Common Stock are duly authorized,
validly issued, fully paid and
non-assessable, were issued in compliance with
applicable securities laws and are not
subject to preemptive rights created by
statute, the Articles of Incorporation or
Bylaws of OrthoNetx, or any agreement
or document to which OrthoNetx is a party
or by which it is bound. As of August
26, 2005 OrthoNetx had reserved an
aggregate of 1,000,000 shares of OrthoNetx
Common Stock, net of exercises, for
issuance to employees, consultants and
non-employee directors pursuant to the
OrthoNetx Option Plan, under which no
options are outstanding. All shares of
OrthoNetx Common Stock subject to
issuance as aforesaid, upon issuance on the
terms and conditions specified in
the instruments pursuant to which they are
issuable, would be duly authorized,
validly issued, fully paid and
non-assessable. OrthoNetx has issued 100,000
warrants, which upon exercise will allow
the purchase of 100,000 common shares.
These warrants are included in the factor
calculation for the share exchange
with Parent. Section 2.2 of the OrthoNetx
Schedule lists (i) each outstanding
option to acquire shares of OrthoNetx
Common Stock as of August 26, 2005, the
name of the holder of such option, the
number of shares subject to such option,
the exercise price of such option, the
number of shares as to which such option
will have vested at such date, the vesting
schedule for such option and whether
the exercisability of such option will be
accelerated in any way by the
transactions contemplated by this Agreement
or for any other reason and
indicates the extent of acceleration, if
any, and (ii) each outstanding
OrthoNetx warrant as of August 26, 2005,
the name of the holder of such
OrthoNetx warrant and the exercise price
therefor.
2.3 OBLIGATIONS WITH RESPECT TO CAPITAL STOCK. Except as set forth
in
Section 2.2, there are no equity
securities, partnership interests or similar
ownership interests of any class of
OrthoNetx, or any securities exchangeable or
convertible into or exercisable for such
equity securities, partnership
interests or similar ownership interests
issued, reserved for issuance or
outstanding. Except for securities
OrthoNetx owns, directly or indirectly
through one or more Subsidiaries, there are
no equity securities, partnership
interests or similar ownership interests of
any class of any Subsidiary of
OrthoNetx, or any security exchangeable or
convertible into or exercisable for
such equity securities, partnership
interests or similar ownership interests
issued, reserved for issuance or
outstanding. Except as set forth in Section
2.2, there are no options, warrants, equity
securities, partnership interests or
similar ownership interests, calls, rights
(including preemptive rights),
commitments or agreements of any character
to which OrthoNetx or any of its
Subsidiaries is a party or by which it is
bound obligating OrthoNetx or any of
its Subsidiaries to issue, deliver or sell,
or cause to be issued, delivered or
sold, or repurchase, redeem or otherwise
acquire, or cause the repurchase,
redemption or acquisition, of any shares of
capital stock of OrthoNetx or any of
its Subsidiaries or obligating OrthoNetx or
any of its Subsidiaries to grant,
extend, accelerate the vesting of or enter
into any such option, warrant, equity
security, partnership interest or similar
ownership interest, call, right,
commitment or agreement. There are no
registration rights and, to the knowledge
of OrthoNetx there are no voting trusts,
proxies or other agreements or
understandings with respect to any equity
security of any class of OrthoNetx or
with respect to any equity security,
partnership interest or similar ownership
interest of any class of any of its
Subsidiaries.
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2.4 AUTHORITY.
(a) OrthoNetx has all requisite corporate power and authority
to enter into this Agreement and to
consummate the transactions contemplated
hereby and thereby. The execution and
delivery of this Agreement and the
consummation of the transactions
contemplated hereby, have been duly authorized
by all necessary corporate action on the
part of OrthoNetx, subject only to the
adoption of this Agreement by OrthoNetx's
stockholders and the filing and
recordation of the Articles of Merger
pursuant to the NRS. A vote of the holders
of at least a majority of the outstanding
shares of the OrthoNetx Common Stock
is required for OrthoNetx's stockholders to
approve and adopt this Agreement and
approve the Merger. This Agreement has been
duly executed and delivered by
OrthoNetx and, assuming the due
authorization, execution and delivery by Parent
and EYDY Merger Sub, constitutes the valid
and binding obligation of OrthoNetx,
enforceable in accordance with its terms,
except as enforceability may be
limited by bankruptcy, insolvency,
fraudulent transfer, reorganization,
moratorium and other similar laws and
general principles of equity. The
execution and delivery of this Agreement by
OrthoNetx does not, and the
performance of this Agreement by OrthoNetx
will not (i) conflict with or violate
the Articles of Incorporation or Bylaws of
OrthoNetx (the "OrthoNetx Charter
Documents") or the equivalent
organizational documents of any of its
Subsidiaries, (ii) subject to compliance
with the requirements set forth in
Section 2.4(b) below, conflict with or
violate any law, rule, regulation, order,
judgment or decree applicable to OrthoNetx
or any of its Subsidiaries or by
which its or any of its respective
properties is bound or affected, or (iii)
result in any breach of, or constitute a
default (or an event that with notice
or lapse of time or both would become a
default) under, or impair OrthoNetx's
rights or alter the rights or obligations
of any third party under, or to
OrthoNetx's knowledge, give to others any
rights of termination, amendment,
acceleration or cancellation of, or result
in the creation of a lien or
encumbrance on any of the properties or
assets of OrthoNetx or any of its
Subsidiaries pursuant to, any note, bond,
mortgage, indenture, contract,
agreement, lease, license, permit,
franchise or other instrument or obligation
to which OrthoNetx or any of its
Subsidiaries is a party or by which OrthoNetx
or any of its Subsidiaries or its or any of
its respective properties are bound
or affected, except to the extent such
conflict, violation, breach, default,
impairment or other effect would not, in
the case of clause (ii) or (iii),
individually or in the aggregate,
reasonably be expected to have an OrthoNetx
Material Adverse Effect.
(b) No consent, approval, order or authorization of, or
registration, declaration or filing with
any court, administrative agency or
commission or other governmental authority
or instrumentality (a "Governmental
Entity") is required by or with respect to
OrthoNetx in connection with the
execution and delivery of this Agreement,
or the consummation of the
transactions contemplated hereby, except
for (i) the filing of the Articles of
Merger with the Secretary of State of
Nevada, (ii) such consents, approvals,
orders, authorizations, registrations,
declarations and filings as may be
required under applicable federal and state
securities laws and (iii) such other
consents, authorizations, filings,
approvals and registrations which, if not
obtained or made, individually or in the
aggregate, would not be reasonably
likely to have an OrthoNetx Material
Adverse Effect.
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2.5 ORTHONETX FINANCIAL STATEMENTS. Prior to the Effective
Time,
OrthoNetx shall provide to Parent, an
audited consolidated balance sheet of
OrthoNetx and its Subsidiaries as of
December 31, 2004 together with the related
audited statements of income, cash flows
and shareholders' equity for the year,
and (ii) an unaudited consolidated balance
sheet of OrthoNetx and its
Subsidiaries as of June 30, 2005 (the
"OrthoNetx Balance Sheet"), together with
the related unaudited statements of income,
cash flows and shareholders' equity
for the period of six months then ended
(the "OrthoNetx Financial Statements").
Each of the OrthoNetx Financial Statements
(including, in each case, any related
notes thereto) was and will be prepared in
accordance with generally accepted
accounting principles ("GAAP") applied on a
consistent basis throughout the
periods involved (except as may be
indicated in the notes thereto or, in the
case of unaudited interim financial
statements, as may be permitted by the
Securities Exchange Commission (the "SEC")
on form 10-QSB under the Securities
Exchange Act of 1934, as amended (the
"Exchange Act")), and each fairly presents
and will fairly present the consolidated
financial position of OrthoNetx and its
Subsidiaries as of the respective dates
thereof and the consolidated results of
its operations and cash flows and
stockholder equity for the periods indicated.
Except as disclosed in the OrthoNetx
Financial Statements, OrthoNetx does not
have any liabilities (absolute, accrued,
contingent or otherwise) of a nature
required to be disclosed on a balance sheet
or in the related notes to the
consolidated financial statements prepared
in accordance with GAAP which are,
individually or in the aggregate, material
to the business, results of
operations or financial condition of
OrthoNetx, except liabilities incurred
since the date of the OrthoNetx Financial
Statements in the ordinary course of
business consistent with past practices and
which would not reasonably be
expected to have an OrthoNetx Material
Adverse Effect.
2.6 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as contemplated
by
this Agreement, since the date of the
OrthoNetx Balance Sheet, OrthoNetx and its
Subsidiaries have conducted their
respective businesses only in, and have not
engaged in any material transaction other
than according to, the ordinary and
usual course of such businesses and there
has not been (i) any change that,
individually or in the aggregate, has had
or is reasonably likely to have an
OrthoNetx Material Adverse Effect; (ii) any
material damage, destruction or
other casualty loss with respect to any
material asset or property owned, leased
or otherwise used by OrthoNetx or any of
its Subsidiaries, whether or not
covered by insurance; (iii) any
declaration, setting aside or payment of any
dividend or other distribution in cash,
stock or property in respect of the
capital stock of OrthoNetx, except for
dividends or other distributions on its
capital stock publicly announced prior to
the date hereof and except as
expressly permitted hereby; (iv) any event
that would constitute a violation of
Section 4.1 hereof if such event occurred
after the date of this Agreement and
prior to the Effective Time; or (v) any
change by OrthoNetx in accounting
principles, practices or methods. Since the
date of the OrthoNetx Balance Sheet,
there has not been any increase in the
compensation payable or that could become
payable by OrthoNetx to officers or key
employees or any amendment of the
OrthoNetx Option Plan other than increases
or amendments in the ordinary course
of business or (y) as required by any
relevant employment agreement, option
agreement or (z) which, individually or in
the aggregate, would not reasonably
be expected to have an OrthoNetx Material
Adverse Effect.
2.7 TAXES.
(a) For purposes of this Agreement, (i) "Taxes" shall mean all
Federal, state, local, foreign, provincial,
territorial or other taxes, imports,
tariffs, fees, levies or other similar
assessments or liabilities and other
charges of any kind, including income
taxes, profits taxes, franchise taxes, ad
valorem taxes, excise taxes, withholding
taxes, stamp taxes or other taxes of or
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with respect to gross receipts, premiums,
real property, personal property,
windfall profits, sales, use, transfers,
licensing, employment, social security,
workers' compensation, unemployment,
payroll and franchises imposed by or under
any law (meaning all laws, statutes,
ordinances and regulations of any
governmental authority including all
decisions of any court having the effect of
law), and any other taxes, duties or
assessments, together with all interest,
penalties and additions imposed with
respect to such amounts; (ii) "Tax Returns"
shall mean any declaration, return, report,
schedule, certificate, statement or
other similar document (including relating
or supporting information) required
to be filed with any Taxing Authority (as
defined below), or where none is
required to be filed with a Taxing
Authority, the statement or other document
issued by the applicable Taxing Authority
in connection with any Tax, including,
without limitation, any information return,
claim for refund, amended return or
declaration of estimated Tax; and (iii)
"Taxing Authority" shall mean any
domestic, foreign, Federal, national,
provincial, state, county or municipal or
other local government or court, any
subdivision, agency, commission or
authority thereof, or any
quasi-governmental body exercising tax regulatory
authority.
(b) OrthoNetx and each of its Subsidiaries have (i) timely
filed all Tax Returns that are required to
have been filed by it with all
appropriate Taxing Authorities (and all
such returns are true and correct and
fairly reflect in all material respects its
operations for tax purposes), and
(ii) timely paid all Taxes shown as owing
on such Tax Returns or assessed by any
Taxing Authority (other than Taxes the
validity of which are being contested in
good faith by appropriate proceedings).
Between the date of the OrthoNetx
Balance Sheet and the Closing Date, neither
OrthoNetx nor any of its
Subsidiaries has incurred (or will incur) a
Tax liability other than a Tax
liability in the ordinary course of
business and in accordance with past custom
and practice. The assessment of any
additional Taxes for periods for which Tax
Returns have been filed is not expected to
exceed reserves made in accordance
with GAAP and reflected in the OrthoNetx
Financial Statements and the OrthoNetx
Balance Sheet and, to OrthoNetx's
knowledge, there are no material unresolved
questions or claims concerning OrthoNetx's
or any Subsidiaries' tax liability.
Neither OrthoNetx's nor any Subsidiaries'
Tax Returns have been reviewed or
audited by any Taxing Authority and no
deficiencies for any Taxes have been
proposed, asserted or assessed either
orally or in writing against OrthoNetx or
any of its Subsidiaries that are not
adequately reserved for in accordance with
GAAP. No liens exist for Taxes (other than
liens for Taxes not yet due and
payable) with respect to any of the assets
or properties of OrthoNetx or any
Subsidiary.
(c) Neither OrthoNetx nor any Subsidiary has outstanding any
agreements or waivers extending, or having
the effect of extending, the statute
of limitations with respect to the
assessment or collection of any Tax or the
filing of any Tax Return.
(d) Neither OrthoNetx nor any Subsidiary is a party to or
bound by any tax-sharing agreement, tax
indemnity obligation or similar
agreement, arrangement or practice with
respect to Taxes (including any advance
pricing agreement, closing agreement or
other agreement relating to Taxes with
any Taxing Authority).
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(e) OrthoNetx shall not be required to include in a taxable
period ending after the Closing Date any
taxable income attributable to income
that accrued in a prior taxable period but
was not recognized in any prior
taxable period as a result of the
installment method of accounting, the
long-term contract method of accounting,
the cash method of accounting or
Section 481 of the Code or any comparable
provision of state, local or foreign
Tax law, or for any other reason.
(f) Neither OrthoNetx, nor any of its Subsidiaries or
affiliates, has made with respect to
OrthoNetx any consent under Section 341 of
the Code, no property of OrthoNetx is "tax
exempt use property" within the
meaning of Section 168(h) of the Code, and
none of the assets of OrthoNetx are
subject to a lease under Section 7701(h) of
the Code or under any predecessor
section thereof.
(g) OrthoNetx has complied in all material respects with all
applicable laws relating to the payment and
withholding of Taxes (including,
without limitation, withholding of Taxes
pursuant to Sections 1441, 1442, 3121,
3402 and 3406 of the Code or any comparable
provision of any state, local or
foreign laws) and has, within the time and
in the manner prescribed by
applicable law, withheld from and paid over
to the proper Taxing Authorities all
amounts required to be so withheld and paid
over under applicable laws.
(h) The net operating losses ("NOL") of OrthoNetx or any of
its Subsidiaries are not, as of the date
hereof, subject to Section 382 or 269
of the Code, Regulation Section
1.1502-21(c), or any similar provisions or
Regulations otherwise limiting the use of
the NOLs of OrthoNetx or its
Subsidiaries.
(i) OrthoNetx is not, and has not been for the five years
preceding the Closing, a "United States
real property holding company" (as such
term is defined in Section 897(c)(2) of the
Code).
(j) As of the date hereof, to the knowledge of OrthoNetx,
neither OrthoNetx nor any of its
Subsidiaries or affiliates has taken or agreed
to take any action or failed to take any
action that would prevent the Merger
from constituting a reorganization within
the meaning of Section 368(a) of the
Code.
(k) Any deficiency resulting from any audit or examination
relating to Taxes of OrthoNetx by any
Taxing Authority has been timely paid.
(l) No power of attorney with respect to any Taxes has been
executed or filed with any Taxing Authority
by or on behalf of OrthoNetx.
2.8 INTELLECTUAL PROPERTY.
(a) To its knowledge, OrthoNetx owns, or has the right to use
pursuant to valid license, sublicense,
agreement, or permission, all
intellectual property rights used in or
necessary for the operation of
OrthoNetx's business as presently conducted
and the execution and delivery of
this Agreement and the closing of the
transaction contemplated hereby will not
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alter or impair any such rights. To its
knowledge, OrthoNetx has taken, and
shall continue to take through the Closing
Date, all necessary action to
maintain and protect each item of
intellectual property that it owns or uses.
(b) The OrthoNetx Schedule identifies (i) each patent,
trademark, trade name, service name or
copyright with respect to any of
OrthoNetx's intellectual property, all
applications and registration statements
therefor and renewals thereof (and sets
forth correct and complete copies of all
such patents, registrations and
applications (as amended to date).
(c) OrthoNetx has at all times used reasonable efforts to
protect all trade secrets related to its
intellectual property.
2.9 COMPLIANCE; PERMITS; RESTRICTIONS.
(a) Neither OrthoNetx nor any of its Subsidiaries is in
conflict with, or in default or violation
of (i) any law, rule, regulation,
order, judgment or decree applicable to
OrthoNetx or any of its Subsidiaries or
by which its or any of their respective
properties is bound or affected, or (ii)
any note, bond, mortgage, indenture,
contract, agreement, lease, license,
permit, franchise or other instrument or
obligation to which OrthoNetx or any of
its Subsidiaries is a party or by which
OrthoNetx or any of its Subsidiaries or
its or any of their respective properties
is bound or affected except for those
conflicts, defaults or violations which
would not be reasonably expected to have
an OrthoNetx Material Adverse Effect. To
the knowledge of OrthoNetx, no
investigation or review by any Governmental
Entity is pending or threatened
against OrthoNetx or its Subsidiaries, nor
has any Governmental Entity indicated
in writing an intention to conduct the same
other than those which would not
reasonably be expected to have an OrthoNetx
Material Adverse Effect. There is no
agreement, judgment, injunction, order or
decree binding upon OrthoNetx or any
of its Subsidiaries which has or would
reasonably be expected to have the effect
of prohibiting or materially impairing any
business practice of OrthoNetx or any
of its Subsidiaries, any acquisition of
material property by OrthoNetx or any of
its Subsidiaries or the conduct of business
by OrthoNetx as currently conducted.
(b) OrthoNetx and its Subsidiaries hold all permits, licenses,
variances, exemptions, orders and approvals
from Governmental Entities which
would necessary to the conduct of the
business of OrthoNetx except those the
absence of which would not, individually or
in the aggregate, reasonably be
likely to have an OrthoNetx Material
Adverse Effect (collectively, the
"OrthoNetx Permits"). OrthoNetx and its
Subsidiaries are in compliance in all
material respects with the terms of the
OrthoNetx Permits.
2.10 LITIGATION. As of the date of this Agreement, there is no
action,
suit, proceeding, claim, arbitration or
investigation pending, including
derivative suits brought by or on behalf of
OrthoNetx or as to which OrthoNetx
or any of its Subsidiaries has received any
notice of assertion nor, to
OrthoNetx's knowledge, is there a
threatened action, suit, proceeding, claim,
arbitration or investigation against
OrthoNetx or any of its Subsidiaries
seeking to delay, limit or enjoin the
transactions contemplated by this
Agreement or which might reasonably be
expected to have an OrthoNetx Material
Adverse Effect.
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2.11 BROKERS' AND FINDERS' FEES. OrthoNetx has not incurred, nor
will
it incur, directly or indirectly, any
liability for brokerage or finders' fees
or agents' commissions or any similar
charges in connection with this Agreement
or any transaction contemplated hereby
except for certain commissions to be paid
to Galen Capital Group as set forth in
Section 2.11 of the OrthoNetx Schedule
and commissions to be paid in conjunction
with the $3,000,000 private placement
referenced in Section 1.6 above.
2.12 LABOR AGREEMENTS AND ACTIONS; EMPLOYEE BENEFIT PLANS.
(a) OrthoNetx is not bound by or subject to (and none of its
assets or properties is bound by or subject
to) any written or oral, express or
implied, contract, commitment or
arrangement with any labor union, and no labor
union has requested or, to the knowledge of
OrthoNetx, has sought to represent
any of the employees, representatives, or
agents of OrthoNetx. There is no
strike or other labor dispute involving
OrthoNetx pending or, to the knowledge
of OrthoNetx, threatened, nor is OrthoNetx
aware of any labor organization
activity involving its employees.
(b) Section
2.12(b) of the OrthoNetx Schedule contains a
complete list of each pension,
profit-sharing or other retirement, bonus,
deferred compensation, employment
agreement, severance agreement, incentive
compensation, stock purchase, stock option,
severance or termination pay,
hospitalization or other medical, life or
other insurance, long- or short-term
disability, fringe benefit, sick pay, or
vacation pay, or other employee benefit
plan, program, agreement, or arrangement or
policy, whether formal or informal,
funded or unfunded, written or unwritten,
and whether legally binding or not,
sponsored, maintained, contributed to or
required to be contributed to by (i)
OrthoNetx with respect to current or former
employees or any current or former
director, independent contractor or
consultant of OrthoNetx, and/or (ii) any
trade or business, whether or not
incorporated, that together with OrthoNetx
would be deemed a "single employer" that
includes OrthoNetx within the meaning
of Section 4001(a)(14) of ERISA, and the
rules and regulations promulgated
thereunder (collectively the "OrthoNetx
Benefit Plans"), including a summary of
each informal or unwritten OrthoNetx
Benefit Plan. Section 2.12(b) of the
OrthoNetx Schedule identifies each
OrthoNetx Benefit Plan that is a "pension
benefit plan" under Section 3(2) of ERISA
("OrthoNetx Pension Plan"), and
discloses whether each OrthoNetx Benefit
Plan that is an "employee welfare
benefit plan" under Section 3(1) of ERISA
("OrthoNetx Welfare Plan") is (i)
unfunded, (ii) insured, or (iii) funded
through a "welfare benefit fund" within
the meaning of Section 419(e) of the Code
or another funding mechanism.
(c) All OrthoNetx Benefit Plans that are "employee benefit
plans" within the meaning of Section 3(3)
of ERISA covering OrthoNetx Employees
(the "OrthoNetx Plans"), to the extent
subject to ERISA, are in substantial
compliance with ERISA, the Code, and all
other applicable law. Each OrthoNetx
Pension Plan that is intended to be
qualified under Section 401(a) of the Code
either has received a favorable
determination letter from the Internal Revenue
Service (the "IRS") stating that it is so
qualified, or it is in a prototype or
volume submitter plan document that has
been pre-approved by the IRS as is
evidenced by a letter from the IRS, and
nothing has occurred that could
reasonably be expected to affect adversely
the qualified status of such plan. As
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of the date hereof, other than claims for
benefits submitted in the ordinary
course by participants or beneficiaries
under the OrthoNetx Benefit Plans, no
material claim against any OrthoNetx
Benefit Plan, and no legal or regulatory
proceeding (including any audit or
voluntary compliance resolution or closing
agreement program proceeding) involving,
any OrthoNetx Benefit Plan, is pending,
or to the knowledge of OrthoNetx,
threatened.
(d) Neither OrthoNetx nor any of its Subsidiaries has engaged
in a transaction with respect to any
OrthoNetx Plan that, assuming the taxable
period of such transaction expired as of
the date hereof, could subject
OrthoNetx or any Subsidiary to a tax or
penalty imposed by either Section 4975
of the Code or Section 502(i) of ERISA in
an amount which would be material.
(e) No current or former OrthoNetx Pension Plan or pension
plan of any of its Subsidiaries, or any
entity which is considered one employer
with OrthoNetx under Section 4001 of ERISA
or Section 414 of the Code (an "ERISA
Affiliate"), is or has ever been subject to
Title IV of ERISA or Section 412 of
the Code. No OrthoNetx Benefit Plan
constitutes a multiemployer plan within the
meaning of Section 3(37) of ERISA.
(f) All contributions required to be made under the terms of
any OrthoNetx Plan have been timely made or
have been reflected on the audited
financial statements of OrthoNetx.
(g) Neither OrthoNetx nor any of its Subsidiaries has any
obligations for retiree health and life
benefits under any OrthoNetx Plan or has
ever represented, promised or contracted
(whether in oral or written form) to
any employee(s) that such employee(s) would
be provided with retiree health or
life benefits which would have a material
impact on OrthoNetx, except as
required under Section 601 of ERISA.
(h) The consummation of the transactions contemplated by this
Agreement will not (x) entitle any
employees of OrthoNetx or any of its
Subsidiaries to severance pay, (y)
accelerate the time of payment or vesting or
trigger any payment or funding (through a
grantor trust other otherwise) of
compensation or benefits under, increase
the amount payable or trigger any other
material obligation pursuant to, any of the
OrthoNetx Benefit Plans or (z)
result in any breach or violation of, or a
default under, any of the OrthoNetx
Benefit Plans.
(i) Any amount that could be received (whether in cash,
property, or vesting of property) as a
result of the transaction contemplated by
this Agreement by any officer, director,
employee or independent contractor of
OrthoNetx or any of its Subsidiaries, who
is a "disqualified individual" (as
defined in Treasury Regulation Section
1.280G-1), under any employment
arrangement or OrthoNetx Benefit Plan would
not be characterized as an "excess
parachute payment" (as defined in Section
280G of the Code).
(j) All OrthoNetx Benefit Plans covering current or former
non-U.S. Employees complies in all material
respects with applicable law, and no
unfunded liabilities exist with respect to
any OrthoNetx Benefit Plan that
covers such non-U.S. Employees.
2.13 ABSENCE OF LIENS AND ENCUMBRANCES. OrthoNetx and each of
its
Subsidiaries has good and valid title to,
or, in the case of leased properties
and assets, valid leasehold interests in,
all of its tangible properties and
assets, real, personal and mixed, used in
its business, free and clear of any
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Liens and Encumbrances except (i) as
reflected in the OrthoNetx Financial
Statements and/or the OrthoNetx Schedule,
(ii) for liens or taxes not yet due
and payable and (iii) for such
imperfections of title and encumbrances, if any,
which would not be reasonably expected to
have an OrthoNetx Material Adverse
Effect.
2.14 ENVIRONMENTAL MATTERS.
(a) HAZARDOUS MATERIALS ACTIVITIES. Except as would not
reasonably be likely to result in a
material liability to OrthoNetx (in any
individual case or in the aggregate), (i)
neither OrthoNetx nor any of its
Subsidiaries has transported, handled,
treated, stored, used, manufactured,
distributed, disposed of, released or
exposed its employees or others to
pollutants, contaminants, hazardous w