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AGREEMENT AND PLAN OF MERGER

Agreement and Plan of Merger

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Title: AGREEMENT AND PLAN OF MERGER
Governing Law: North Carolina     Date: 9/7/2004

AGREEMENT AND PLAN OF MERGER, Parties: technology connections   inc , houseraising inc
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                          AGREEMENT AND PLAN OF MERGER

 

Agreement   entered   into   as   of   February   19,   2004, by and between Technology

Connections,   Inc.,   a   North Carolina corporation ("Technology"), HouseRaising,

Inc.,   a   Delaware corporation ("HouseRaising"), and the persons whose names are

set   forth   on the signature page hereof, who are the owners of record of all of

the   issued   and   outstanding   stock   of   HouseRaising   (the   "HouseRaising

Stockholders").   Technology,   HouseRaising and the HouseRaising Stockholders are

referred   to   collectively   herein   as   the   "Parties".

 

This   Agreement   contemplates   a   tax-free   merger of HouseRaising with and into

Technology   in a reorganization pursuant to Code   368(a)(1)(A). However, none of

the   Parties   is   seeking tax counsel or legal or accounting opinions on whether

the merger qualifies for tax free treatment and tax free treatment of the merger

is   not   a   condition   precedent   to   the   obligations   of   the   Parties to this

Agreement. HouseRaising Stockholders will receive capital stock in Technology in

exchange   for   their   capital   stock   in   HouseRaising.

 

Now,   therefore, in consideration of the premises and the mutual promises herein

made,   and   in   consideration   of the representations, warranties, and covenants

herein   contained,   the   Parties   agree   as   follows.

 

                                    ARTICLE I

                             THE MERGER TRANSACTION

 

1.01      The   Merger.

 

On   and subject to the terms and conditions of this Agreement, HouseRaising will

merge   with   and   into   Technology   (the   "Merger") at the Closing as defined in

Section   1.02   herein.   Technology shall be the corporation surviving the Merger

(the   "Surviving   Corporation")   and   HouseRaising   will   cease   to   exist.

 

1.02      The   Closing.

 

The   Closing   of the transactions contemplated by this Agreement (the "Closing")

shall   take   place   at   the   offices of Technology in Charlotte, North Carolina,

commencing   at   9:00   a.m.   local   time on the second business day following the

satisfaction   or   waiver   of all conditions to the obligations of the Parties to

consummate   the   transactions   contemplated   hereby   (other than conditions with

respect   to   actions   the respective Parties will take at the Closing itself) or

such   other   date   as   the   Parties may mutually determine (the "Closing Date").

 

1.03      Actions   by   Technology   Prior   to   Closing:

 

Prior   to   closing, Technology will timely file the following documents with the

Securities   and   Exchange   Commission   ("the   Commission"):

 

(i)   Form   8K;

(ii) Schedule   14C,   disclosing   the   merger   and   amendment   to the Articles of

     Incorporation;   and

(iii)All   other   filings   and   periodic   filing   Technology is required to file,

     including   but   not   limited   to   its Form 10-KSB for the fiscal year ended

     December   31,   2003,   and   its   Form 10-QSB for the quarter ended March 31,

     2004,   if   such reports are required to be filed prior to the Closing Date.

 

1.04      Actions   at   the   Closing.

 

At   the   Closing,   (i)   HouseRaising   will   deliver   to   Technology   the various

certificates,   instruments,   and   documents   referred to herein, (ii) Technology

will   deliver   to   HouseRaising   the   various   certificates,   instruments,   and

documents   referred   to   herein, and (iii) Technology and HouseRaising will file

with   the   Secretary   of   State   of   the State of North Carolina Certificates of

Merger.

 

1.05       Effect   of   the   Merger.

 

(i)   General.   The   Merger   shall   become   effective at the time (the "Effective

     -------

     Time")   that   Technology   and   HouseRaising file the Certificates of Merger

     with   the   Secretary   of   State   of the State of North Carolina. The Merger

     shall   have the effect set forth in the North Carolina Business Corporation

     Act.   Technology may, at any time after the Effective Time, take any action

     (including executing and delivering any document) in the name and on behalf

     of   either   Technology or HouseRaising in order to carry out and effectuate

     the   transactions   contemplated   by   this   Agreement.

 

(ii) Certificate   of   Incorporation.   The   Certificate   of   Incorporation   of

     ------------------------------

     Technology   in   effect   at   and   as   of   the Effective Time will remain the

     Certificate   of   Incorporation   of   the   Surviving   Corporation without any

     modification   or   amendment   resulting   solely as a result of the Merger or

     this Agreement, except for an amendment to the Certificate of Incorporation

     of   Technology to change the corporate name of Technology to "HouseRaising,

     Inc."   Technology hereby agrees to take all steps which may be necessary to

     change its name as aforesaid and to change its ticker symbol, such steps to

     be   taken as promptly as practicable after the execution of this Agreement.

 

(iii)Bylaws.   The Bylaws of Technology in effect at and as of the Effective Time

      -----

     will   remain   the   Bylaws   of   the   Surviving   Corporation   without   any

     modification   or   amendment   solely   as   a   result   of   the   Merger.

 

(iv) Conversion   of   HouseRaising   Shares. At and as of the Effective Time, each

     ------------------------------------

     share of HouseRaising Class "A" common stock and each share of HouseRaising

      Class   "B"   common   stock (each being referred to herein as a "HouseRaising

     common share")(other than any Dissenting Share) shall be converted into 1.0

     shares   of   common stock of Technology and .036645 shares of Class A Voting

     Convertible Preferred Stock ("Class A Convertible Preferred") of Technology

     (the   ratios of 1.0 common shares and .036645 Class A Convertible Preferred

     of   Technology   to   one HouseRaising common share are referred to herein as

     the   "Conversion   Ratios").   The   Conversion   Ratios   shall   be   subject to

     equitable   adjustment   in   the   event   of   any stock split, stock dividend,

     reverse   stock   split, or other change in the number of HouseRaising common

     shares   outstanding.   No   HouseRaising   common   share shall be deemed to be

     outstanding   or   to   have any rights other than those set forth above after

     the   Effective   Time.

 

(v)   Issuance   of   Technology Common and Preferred. In the aggregate, 27,288,732

     ---------------------------------------------

     shares of Technology common stock which shall represent a minimum of 51% of

     the   outstanding   shares of common stock of Technology and 1,000,000 shares

     of   Technology   Class   A   Convertible   Preferred   will   be   issued   to   the

     HouseRaising   Stockholders   at   and   as of the Effective Time. The relative

     rights,   preferences   and   terms   and   conditions   of   the   shares   of   the

     Technology   preferred   voting   stock   are   set   forth   in Exhibit A hereto.

 

1.06       Closing   Procedure.

 

(i)   At   closing, Technology will deliver to the HouseRaising Stockholders stock

     certificates   representing   the number of shares of Technology common stock

     and   Class A Convertible Preferred to which each of them is entitled issued

     in   each   HouseRaising   Shareholders   respective   name.   Each   HouseRaising

     Shareholder   shall deliver certificates endorsed in blank or accompanied by

     stock   powers   executed   in   blank, representing the HouseRaising shares of

     common   stock   to   be surrendered, with all signatures medallion guaranteed

     and   with all necessary transfer taxes and other revenue stamps affixed and

     acquired   at   the   HouseRaising   Stockholders'   expense.

 

(ii) At   the   Closing and from time to time thereafter, the Parties hereto shall

     execute such additional instruments and take such other action as the other

     party   may   reasonably   request   in   order   to   facilitate the transactions

     contemplated   herein.

 

 

                                    ARTICLE II

            REPRESENTATIONS, COVENANTS AND WARRANTIES OF TECHNOLOGY

 

As   an   inducement   to,   and   to obtain the reliance of HouseRaising, Technology

represents,   promises   and   warrants   as   follows:

 

2.01      Organization.

 

Technology   is,   and   will   be at Closing, a corporation duly organized, validly

existing, and in good standing under the laws of the State of North Carolina and

has   the   corporate   power   and   is   and   will   be   duly   authorized, qualified,

franchised, and licensed under all applicable laws, regulations, ordinances, and

orders   of   public   authorities   to   own all of its properties and assets and to

carry on its business in all material respects as it is now being conducted, and

there   are   no   other jurisdictions in which it is not so qualified in which the

character   and   location of the assets owned by it or the nature of the material

business   transacted by it requires qualification, except where failure to do so

would   not   have   a   material   adverse   effect   on   its   business,   operations,

properties,   assets   or condition.   The execution and delivery of this Agreement

does   not,   and   the   consummation   of   the   transactions   contemplated   by this

Agreement in accordance with the terms hereof will not, violate any provision of

Technology's Articles of Incorporation or Bylaws, or other agreement to which it

is   a   party   or   by   which   it   is   bound.

 

2.02      Approval   of   Agreement.

 

Technology   has   full   power,   authority, and legal right and has taken, or will

take,   all   action   required   by law, its Articles of Incorporation, Bylaws, and

otherwise   to   execute   and   deliver   this   Agreement   and   to   consummate   the

transactions   herein   contemplated.   The   board   of   directors of Technology has

authorized   and   approved   the   execution,   delivery,   and   performance   of this

Agreement   and   the transactions contemplated hereby are subject to the approval

of   the   Technology   shareholders   and   compliance   with   state and federal law.

Technology   shareholders   will not have dissenters rights with respect to any of

the   transactions   contemplated   herein.

 

2.03      Capitalization.

 

The   authorized   capitalization   of Technology consists of 100,000,000 shares of

common   stock,   $0.001   par   value,   of   which   1,347,893   shares are issued and

outstanding   prior   to   issuance   of   shares   as   set forth in Article I of this

Agreement.   There   are   5,000,000   shares   of preferred stock authorized, having

such   terms, conditions, relative rights and preferences as may be determined by

the Board of directors from time to time when issued, and no shares of preferred

stock are issued and outstanding prior to the issuance of shares as set forth in

Article   I   of   this Agreement.   There are, and at the Closing, there will be no

outstanding   subscriptions,   options,   warrants,   convertible securities, calls,

rights, commitments or agreements calling for or requiring issuance or transfer,

sale   or   other   disposition   of   any   shares of capital stock of the Company or

calling   for   or   requiring the issuance of any securities or rights convertible

into   or   exchangeable   (including   on a contingent basis) for shares of capital

stock.   All of the outstanding shares of Technology are duly authorized, validly

issued,   fully   paid   and   non-assessable   and   not   issued   in violation of the

preemptive or other right of any person.   There are no dividends due, to be paid

or   in   arrears   with   respect   to   any   of   the   capital   stock   of   Company.

 

2.04      Financial   Statements.

 

(i)   Included in Schedule 2.04 are the audited balance sheet of Technology as of

     December   31, 2002, and the related statements of operations, stockholders'

     equity   (deficit),   and   cash   flows for the fiscal year ended December 31,

     2002, including the notes thereto, and related statements of operations for

     the   quarters   then ended (collectively the "Financial Statements") and the

     accompanying   auditor's   report   and representations by the Chief Financial

     Officer   of Technology to the effect that such financial statements contain

     all   adjustments   (all of which are normal recurring adjustments) necessary

     to   present fairly the results of operations and financial position for the

     periods   and   as   of   the   dates   indicated.

 

(ii) The   financial   statements   of   Technology   delivered   pursuant   to Section

     2.04(i) have been prepared in accordance with generally accepted accounting

     principles   consistently   applied   throughout   the   periods   involved   as

     explained   in   the   notes   to   such   financial   statements.   The Technology

     financial   statements   present   fairly, in all material respects, as of the

     closing   date,   the   financial   position of Technology. Technology will not

      have,   as   of   the   Closing   Date,   any   liabilities, obligations or claims

     against   it   (absolute or contingent) in excess of $200,000, and all assets

     reflected   therein   present   fairly   the assets of Technology in accordance

     with   generally   accepted   accounting   principles.

 

(iii)Technology   has   filed   or   will   file   as the Closing Date its tax returns

     required   to be filed for its two most recent fiscal years and will pay all

     taxes due thereon. All such returns and reports are accurate and correct in

     all   material   respects.   Technology has no liabilities with respect to the

     payment of any federal, state, county, local, or other taxes (including any

     deficiencies,   interest,   or   penalties)   accrued   for or applicable to the

     period   ended   on the closing date and all such dates and years and periods

     prior thereto and for which Technology may at said date have been liable in

     its   own   right   or as transferee of the assets of, or as successor to, any

     other   corporation   or entity, except for taxes accrued but not yet due and

     payable,   and to the best knowledge of Technology, no deficiency assessment

     or   proposed   adjustment   of   any   such   tax return is pending, proposed or

     contemplated.   None   of   such   income   tax   returns has been examined or is

     currently   being examined by the Internal Revenue Service and no deficiency

     assessment   or   proposed adjustment of any such return is pending, proposed

     or   contemplated.   Technology   has   not   made   any election pursuant to the

     provisions   of   any   applicable   tax laws (other than elections that relate

     solely   to methods of accounting, depreciation, or amortization) that would

     have   a material adverse affect on Technology, its financial condition, its

     business   as presently conducted or proposed to be conducted, or any of its

     respective   properties   or   material   assets.   There   are   no   outstanding

     agreements   or   waivers   extending   the   statutory   period   of   limitation

     applicable   to   any   tax   return   of   Technology.

 

2.05      Information.

 

The   information   concerning   Technology set forth in this Agreement is complete

and accurate in all respects and does not contain any untrue statement of a fact

or   omit   to   state a fact required to make the statements made, in light of the

circumstances   under   which   they   were   made, not misleading.   Technology shall

cause   the   schedules   delivered   by   it   pursuant   hereto   and   the instruments

delivered   to   HouseRaising   hereunder to be updated after the date hereof up to

and   including   the   Closing   Date.

 

2.06      Absence   of   Certain   Changes   or   Events.

 

Except as set forth in this Agreement or the schedules hereto, since the date of

the   most recent Technology balance sheet described in Section 2.04 and included

in   the   information   referred   to   in   Section   2.06:

 

(a)   There   has   not   been:   (i) any adverse change in the business, operations,

     properties, level of inventory, assets, or condition of Technology; or (ii)

     any   damage,   destruction, or loss to Technology (whether or not covered by

     insurance)   adversely   affecting   the   business,   operations,   properties,

     assets,   or   conditions   of   Technology;

 

(b)   Technology   has   not:   (i) amended its Articles of Incorporation or Bylaws;

     (ii)   declared   or   made,   or   agreed   to   declare   or make, any payment of

     dividends   or   distributions   of   any   assets   of   any   kind   whatsoever to

     stockholders or purchased or redeemed, or agreed to purchase or redeem, any

     of   its   capital   stock;   (iii)   waived   any   rights   of value which in the

     aggregate   are   extraordinary   or   material   considering   the   business   of

     Technology;   (iv)   made   any   material   change in its method of management,

     operation, or accounting; (v) entered into any other material transactions;

     (vi)   made   any accrual or arrangement for or payment of bonuses or special

     compensation of any kind or any severance or termination pay to any present

     or   former   officer   or   employee; (vii) increased the rate of compensation

     payable   or   to become payable by it to any of its officers or directors or

     any   of   its employees whose monthly compensation exceeds $1,000; or (viii)

     made   any   increase   in   any   profit-sharing, bonus, deferred compensation,

     insurance, pension, retirement, or other employee benefit plan, payment, or

     arrangement   made   to,   for, or with its officers, directors, or employees;

 

(c)   Technology   has   not: (i) granted or agreed to grant any options, warrants,

     or   other   rights   for   its   stocks,   bonds,   or other corporate securities

     calling   for   the   issuance   thereof; (ii) borrowed or agreed to borrow any

      funds   or   incurred,   or   become   subject   to,   any   material obligation or

     liability   (absolute   or   contingent)   except   liabilities   incurred in the

     ordinary   course   of   business;   (iii)   paid   any   material   obligation   or

     liability (absolute or contingent) other than current liabilities reflected

     in   or   shown   on   the   most   recent   Technology   balance sheet and current

     liabilities   incurred   since   that date in the ordinary course of business;

     (iv)   sold   or   transferred,   or   agreed   to   sell   or transfer, any of its

     material   assets,   properties,   or   rights   (except   assets, properties, or

     rights   not   used   or useful in its business which, in the aggregate have a

     value   of   less   than $5,000 or canceled, or agreed to cancel, any debts or

     claims   (except   debts   and claims which in the aggregate are of a value of

     less   than   $5,000);   (v) made or permitted any amendment or termination of

     any   contract,   agreement,   or   license   to   which   it   is   a party if such

     amendment   or   termination   is   material,   considering   the   business   of

     Technology   ;   or (vi) issued, delivered, or agreed to issue or deliver any

     stock,   bonds,   or other corporate securities including debentures (whether

     authorized   and   unissued   or   held   as   treasury   stock);   and

 

(d)   Technology   has   not   become   subject   to   any   law,   order, investigation,

     inquiry, grievance or regulation which materially and adversely affects, or

     in   the   future   would   be   reasonably   expected   to   adversely affect, the

     business,   operations,   properties,   assets,   or   condition   of Technology.

 

2.07      Litigation   and   Proceedings.

 

There   are   no   material   actions,   suits,   claims,   or   administrative or other

proceedings pending, asserted or unasserted, threatened by or against Technology

or adversely affecting Technology or its properties, at law or in equity, before

any   court or other governmental agency or instrumentality, domestic or foreign,

or   before   any   arbitrator   of   any   kind.   Technology is not in default of any

judgment,   order,   writ,   injunction,   decree, award, rule, or regulation of any

court,   arbitrator,   or   governmental   agency   or   instrumentality.

 

2.08      Compliance   With   Laws.

 

Technology and its officers and directors have complied with all federal, state,

county   and local laws, ordinances, regulations, inspections, orders, judgments,

injunctions,   awards   or   decrees   applicable   to   it or its business, including

federal   and   state securities laws.   Technology and its officers, directors and

beneficial   owners   are not under investigation by any federal, state, county or

local   authorities,   including   the   Commission.   Technology   and   its officers,

directors and beneficial owners have not received notification from any federal,

state,   county,   or local authorities, including the Commission,   that it or any

of   its   officers or directors will be the subject of a legal action or that the

Commission's Division of Enforcement will be recommending to the Commission that

a Federal District Court or Commission administrative action or any other action

be   filed or taken against Technology and its officers, directors and beneficial

owners.

 

2.09      Securities   and   Exchange   Commission   Compliance   of   Technology.

 

Technology   has   a   class of securities registered pursuant to Section 12 of the

Securities Exchange Act of 1934, as amended ("Exchange Act") and has complied in

all respects with Rule 14(a) and 14(c) of the Exchange Act, and with Sections 13

and   15(d)   of   the   Exchange Act, and Technology, its management and beneficial

owners   have   complied   in   all   respects   with   Sections 13(d) and 16(a) of the

Exchange   Act.

 

2.10      Material   Contract   Defaults.

 

Technology   is   not   in   default   under   the   terms of any outstanding contract,

agreement, lease, or other commitment, and there is no event of default or other

event which, with notice or lapse of time or both, would constitute a default in

any   respect   under   any   such   contract, agreement, lease, or other commitment.

 

2.11      No   Conflict   With   Other   Instruments.

 

The   execution   of   this   Agreement   and   the   consummation   of the transactions

contemplated   by   this   Agreement   will   not result in the breach of any term or

provision   of,   or constitute an event of default under, any material indenture,

mortgage, deed of trust, or other material contract, agreement, or instrument to

which   Technology is a party or to which any of its properties or operations are

subject.

 

2.12      Subsidiary.

 

Technology   does   not and has never owned, beneficially or of record, any equity

securities   in any other entity.   Technology does not have a predecessor as that

term is defined under generally accepted accounting principles or Regulation S-X

promulgated   by   the   Securities   and   Exchange   Commission.

 

2.13      Technology   Schedules   and   Documents.

 

Technology   will   deliver   to   HouseRaising   the   following   schedules   and

documents   within   ten days prior to the date of closing, which are collectively

referred   to   as   the   "Technology Schedules" and which consist of the following

separate   schedules   dated   as   of   the date of execution of this Agreement, all

certified   by   a   duly   authorized   officer of Technology as complete, true, and

accurate:

 

(a)   A   schedule including copies of the Articles of Incorporation and Bylaws of

     Technology   in   effect   as   of   the   date   of   this   Agreement;

 

(b)   A   schedule   containing   copies   of   resolutions   adopted   by   the board of

     directors   of   Technology   approving   this   Agreement   and the transactions

     herein   contemplated;

 

(c)   A   schedule   setting   forth a description of any material adverse change in

     the   business,   operations,   property,   inventory,   assets, or condition of

     Technology   since   the most recent Technology balance sheet, required to be

     provided   pursuant   to   Section   2.04   hereof;

 

(d)   A   schedule   setting   forth   the   financial statements required pursuant to

     Section   2.04(a)   hereof;

 

(e)   A   schedule setting forth any other information, together with any required

     copies   of   documents, required to be disclosed in the Technology Schedules

     by   Sections   2.01   through   2.12;   and

 

(f)   Legal   opinions   in   a   form acceptable to HouseRaising that Technology has

     complied   with   applicable   securities   laws   pertaining to this Agreement.

 

Technology shall cause the Technology Schedules and the instruments delivered to

HouseRaising hereunder to be updated after the date hereof up to and including a

specified   date   not   more   than   three business days prior to the Closing Date.

Such   updated Technology Schedules, certified in the same manner as the original

Technology   Schedules,   shall be delivered prior to and as a condition precedent

to   the   obligation   of   HouseRaising   to   close.

 

2.14      Quotation   on   the   OTC   Bulletin   Board.

 

Technology's   Common   Stock is quoted on the OTC Bulletin Board under the symbol

"TLGY" and Technology will retain such quotation on the OTC Bulletin Board until

the   Closing   of   the   transactions   contemplated   herein.

 

2.15      Delivery   of   Shareholder   List.

 

Upon   execution   of   this   agreement,   Technology   shall   deliver   a   certified

shareholder   list   from   its   transfer   agent   setting   forth   the   name of each

Technology   shareholder,   the   number of shares held by each, dated as of a date

within   five   days   of   closing   and   whether   such   shares   held are restricted

securities.   In   connection   therewith,   Technology   represents that none of its

shareholders   are   nominees   for   any   other   person.

 

 

                                  ARTICLE III

          REPRESENTATIONS, COVENANTS, WARRANTIES OF HOUSERAISING, ETC.

 

As   an inducement to, and to obtain the reliance of Technology, HouseRaising and

the   HouseRaising   Stockholders, jointly and severally, represent and warrant as

follows:

 

3.01      Organization.

 

HouseRaising   is,   and   will   be   on   the   Closing   Date,   a   corporation   duly

organized, validly existing, and in good standing under the laws of Delaware and

has   the   corporate   power   and   is   and   will   be   duly   authorized, qualified,

franchised, and licensed under all applicable laws, regulations, ordinances, and

orders   of   public   authorities   to   own all of its properties and assets and to

carry on its business in all material respects as it is now being conducted, and

there   are   no   other jurisdictions in which it is not so qualified in which the

character   and   location of the assets owned by it or the nature of the material

business   transacted by it requires qualification, except where failure to do so

would   not   have   a   material   adverse   effect   on   its   business,   operations,

properties,   assets or condition of HouseRaising.   The execution and delivery of

this   Agreement   does not, and the consummation of the transactions contemplated

by   this   Agreement   in   accordance   with the terms hereof will not, violate any

provision   of   HouseRaising's   Articles   of   Incorporation   or   Bylaws, or other

material   agreement   to   which   it   is   a   party   or   by   which   it   is   bound.

 

3.02      Approval   of   Agreement.

 

HouseRaising   has   full power, authority, and legal right and has taken, or will

take,   all   action   required   by   law, its Articles of Incorporation, Bylaws, or

otherwise   to   execute   and   deliver   this   Agreement   and   to   consummate   the

transactions   herein   contemplated.   The   board of directors of HouseRaising has

authorized   and   approved   the   execution,   delivery,   and   performance   of this

Agreement   and   the transactions contemplated hereby, subject to the approval of

the   HouseRaising   Stockholders   and compliance with state and federal corporate

and   securities   laws.

 

3.03      Capitalization.

 

The   authorized   capitalization of HouseRaising consists of 90,000,000 shares of

Class   "A"   common   stock,   par   value $.001, and 10,000,000 shares of Class "B"

common stock, par value $.001, of which as of the date hereof, 16,980,000 shares

of   Class   "A"   common stock and 10,000,000 shares of Class "B" common stock are

issued   and   outstanding   to   the   HouseRaising   Shareholders   set   forth on the

signature   page   hereof.   All   issued and outstanding HouseRaising common shares

are validly issued, fully paid, and nonassessable and not issued in violation of

the   preemptive   or   other right of any person.   There are no dividends or other

amounts   due   or   payable   with respect to any of the shares of capital stock of

HouseRaising.

 

3.04      Financial   Statements.

 

(a)   Included   in Schedule 3.04 are the unaudited balance sheets of HouseRaising

     as   of   December   31,   2002   and the related statements of operations, cash

     flows,   and   stockholders' equity for the period from inception to December

     31,   2002   including   the   notes   thereto   and representations by the Chief

     Operating   Officer   of   HouseRaising   to   the   effect   that   such financial

     statements   contain   all   adjustments   (all   of   which are normal recurring

     adjustments)   necessary   to   present   fairly   the results of operations and

     financial   position   for   the   periods   and   as   of   the   dates   indicated.

 

(b)   The   unaudited   financial   statements delivered pursuant to Section 3.04(a)

     have   been   prepared   in   accordance   with   generally   accepted   accounting

     principles   consistently   applied   throughout   the   periods   involved.   The

     financial statements of HouseRaising present fairly, as of their respective

     dates,   the   financial position of HouseRaising. HouseRaising did not have,

      as   of   the   date   of   any such balance sheets, except as and to the extent

     reflected   or   reserved   against   therein,   any   liabilities or obligations

     (absolute   or   contingent)   which   should   be   reflected   in   any financial

     statements   or   the   notes   thereto   prepared   in accordance with generally

     accepted   accounting   principles,   and all assets reflected therein present

     fairly   the   assets   of HouseRaising, in accordance with generally accepted

     accounting   principles.   The   statements   of   revenue and expenses and cash

     flows   present   fairly   the   financial position and result of operations of

     HouseRaising   as   of   their respective dates and for the respective periods

     covered   thereby.

 

3.05      Outstanding   Warrants   and   Options.

 

HouseRaising   has   no   issued   warrants or options, calls, or commitments of any

nature   relating   to   the   authorized   and   unissued   HouseRaising common stock.

 

3.06      Information.

 

The   information   concerning HouseRaising set forth in this Agreement and in the

schedules   delivered by HouseRaising pursuant hereto is complete and accurate in

all   material   respects   and does not contain any untrue statement of a material

fact   or   omit to state a material fact required to make the statements made, in

light   of   the   circumstances   under   which   they   were   made,   not   misleading.

HouseRaising   shall   cause   the   schedules delivered by HouseRaising pursuant to

this   Agreement   to   Technology   to   be   updated after the date hereof up to and

including   the   Closing   Date.

 

3.07      Absence   of   Certain   Changes   or   Events.

 

Except   as   set   forth   in   this   Agreement,   since   the date of the most recent

HouseRaising   balance   sheet   described   in   Section   3.04   and   included in the

information   referred   to   in   Section   3.06:

 

(a)   There   has   not   been:   (i)   any   material   adverse change in the business,

     operations,   properties,   level   of   inventory,   assets,   or   condition   of

     HouseRaising;   or   (ii)   any   damage,   destruction, or loss to HouseRaising

     materially   and   adversely   affecting the business, operations, properties,

     assets,   or   conditions   of   HouseRaising;

 

(b)   HouseRaising   has not: (i) amended its Articles of Incorporation or Bylaws;

     (ii)   declared   or   made,   or   agreed   to   declare   or make, any payment of

     dividends   or   distributions   of   any   assets   of   any   kind   whatsoever to

     stockholders or purchased or redeemed, or agreed to purchase or redeem, any

     of   its   capital   stock;   (iii)   waived   any   rights   of value which in the

     aggregate   are   extraordinary   and   material   considering   the   business of

     HouseRaising;   (iv)   made   any material change in its method of accounting;

     (v)   entered   into   any   other   material   transactions   other   than   those

     contemplated   by this Agreement; (vi) made any material accrual or material

     arrangement   for   or payment of bonuses or special compensation of any kind

     or   any   severance   or   termination pay to any present or former officer or

     employee; or (vii) made any material increase in any profit-sharing, bonus,

     deferred   compensation,   insurance,   pension, retirement, or other employee

     benefit plan, payment, or arrangement made to, for, or with their officers,

     directors,   or   employees;

 

(c)   HouseRaising   has not (i) granted or agreed to grant any options, warrants,

     or   other   rights   for   its   stocks,   bonds,   or other corporate securities

     calling   for   the   issuance   thereof,   except   as   previously   disclosed to

     Technology,   (ii)   borrowed   or   agreed to borrow any funds or incurred, or

     become   subject   to,   any   material   obligation   or   liability (absolute or

     contingent) except liabilities incurred in the ordinary course of business;

     (iii)   paid   any   material obligation or liability (absolute or contingent)

     other   than   current   liabilities   reflected in or shown on the most recent

     HouseRaising balance sheet and current liabilities incurred since that date

     in   the ordinary course of business; (iv) sold or transferred, or agreed to

     sell   or   transfer,   any   of its material assets, properties, or rights, or

     agreed   to   cancel   any material debts or claims; (v) made or permitted any

     amendment or termination of any contract, agreement, or license to which it

     is   a   party   if such amendment or termination is material, considering the

     business   of HouseRaising; or (vi) issued, delivered, or agreed to issue or

     deliver   any   stock,   bonds,   or   other   corporate   securities   including

     debentures (whether authorized and unissued or held as treasury stock); and

 

(d)   To the best knowledge of HouseRaising, it has not become subject to any law

     or   regulation   which   materially   and   adversely affects, or in the future

     would be reasonably expected to adversely affect, the business, operations,

     properties,   assets,   or   condition   of   HouseRaising.

 

3.08      Title   and   Related   Matters.

 

Except   as   provided herein or disclosed in the most recent HouseRaising balance

sheet   and   the notes thereto, HouseRaising has good and marketable title to all

of   its   properties,   inventory,   interests   in   properties, technology, whether

patented   or unpatented, and assets, all of which are described in Schedule 3.08

and   are   reflected   in   the   most recent HouseRaising balance sheet or acquired

after   that date (except properties, interests in properties, and assets sold or

otherwise   disposed of since such date in the ordinary course of business), free

and clear of all mortgages, liens, pledges, charges, or encumbrances, except (i)

statutory   liens,   mortgages,   loans or claims not yet delinquent; and (ii) such

imperfections of title and easements as do not, and will not, materially detract

from,   or   interfere with, the present or proposed use of the properties subject

thereto   or   affected   thereby   or   otherwise materially impair present business

operations   on   such   properties.   To   the   best   knowle


 
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