AGREEMENT AND PLAN OF MERGER
BY AND BETWEEN
BAYMARK TECHNOLOGIES, INC.,
BT Acquisitions, Inc.,
and
JIG JIG, LLC,
December 16, 2005
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions..............................................1
ARTICLE II
Transactions; Terms of Merger; Manner of Converting Shares...8
2.1
Merger.......................................................8
2.2 Time and
Place of Closing....................................8
2.3 Effective
Time...............................................8
2.4
Certificate of Merger........................................5
2.5
Charter......................................................8
2.6
Bylaws.......................................................8
2.7 Directors
and Officers.......................................8
2.8 Conversion
of Shares.........................................9
2.9 Exchange
of Shares...........................................9
2.10
Rights of Former JIGJIG Stockholders.........................9
2.11
Legending of Shares.........................................10
2.12
Fractional Shares...........................................10
2.13
Lost, Stolen or Destroyed Certificates......................10
ARTICLE III
Representations and Warranties of BYMT AND PURCHASER....10
3.1
Organization; Standing and Power............................11
3.2
Authorization; Enforceability...............................11
3.3 No
Violation or Conflict....................................11
3.4 Consents
of Governmental Authorities and Others.............11
3.5 Conduct of
Business.........................................11
3.6
Litigation..................................................12
3.7
Brokers.....................................................12
3.8
Compliance..................................................12
3.9 Charter,
Bylaws and Corporate Records.......................13
3.10
Subsidiaries and Investments................................13
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3.11
Capitalization..............................................13
3.12
Rights, Warrants, Options...................................13
3.13
Commission Filings and Financial Statements.................14
3.14
Absence of Undisclosed Liabilities..........................14
3.15
Real Property...............................................14
3.16
List of Accounts and Proxies................................14
3.17
Personnel...................................................14
3.18
Employment Agreements and Employee Benefit Plans............15
3.19
Tax Matters.................................................15
3.20
Material Agreements.........................................17
3.21
Guaranties..................................................18
3.22
Absence of Certain Business Practices.......................18
3.23
Disclosure..................................................18
ARTICLE IV
Representations
and Warranties of JIG...................18
4.1
Organization................................................18
4.2
Authorization; Enforceability...............................19
4.3 No
Violation or Conflict....................................19
4.4 Consents
of Governmental Authorities and Others.............19
4.5
Brokers.....................................................19
4.6 Charter,
Bylaws and Corporate Records.......................19
4.7
Subsidiaries and Investments................................19
4.8
Capitalization..............................................20
4.9 Rights,
Warrants, Options...................................20
ARTICLE V
Additional Agreements...................................20
5.1 Survival
of the Representations and Warranties..............20
5.2
Investigation...............................................20
5.3
Indemnification.............................................21
5.4 Indemnity
Procedure.........................................21
<PAGE>
ARTICLE VI
Closing; Deliveries; Conditions Precedent...............22
6.1 Closing;
Effective Date.....................................22
6.2
Deliveries..................................................22
6.3 Conditions
Precedent to the Obligations of JIGJIG...........23
6.4 Conditions
Precedent to the Obligations of BYMT.............25
6.5 Best
Efforts................................................25
6.6
Termination.................................................25
ARTICLE VII
Covenants...............................................26
7.1 General
Confidentiality.....................................26
7.2 Continuing
Obligations......................................27
7.3
Satisfaction of Certain Outstanding Payables................27
7.4 Tax
Matters.................................................27
7.5......No Reverse Covenant
....................................28
ARTICLE VIII
Miscellaneous...........................................28
8.1
Notices.....................................................28
8.2 Entire
Agreement; Incorporation.............................29
8.3 Binding
Effect..............................................29
8.4
Assignment..................................................29
8.5 Waiver and
Amendment........................................29
8.6 No Third
Party Beneficiary..................................29
8.7
Severability................................................29
8.8
Expenses....................................................30
8.9
Headings....................................................30
8.10
Other Remedies; Injunctive Relief...........................30
8.11
Counterparts................................................30
8.12
Remedies Exclusive..........................................30
8.13
Jurisdiction and Venue......................................30
8.14
Participation of Parties....................................27
8.15
Further Assurances..........................................31
8.16
Publicity...................................................31
8.17................................................................
31
8.18
...............................................................
31
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF
MERGER (the
"Agreement"), dated as
of November
__, 2005, by and among JIGJIG, LLC, an Ohio Limited Liability Company ("JIG,
LLC"); BAYMARK TECHNOLOGIES, INC., a Utah corporation
("BYMT"); BYMT and BT
Acquisitions, Inc., a Colorado corporation
(the "Purchaser").
W I T N E S S E T H:
Preamble
The respective Boards of Directors of BYMT and Purchaser and
Manager of
JIG are of the opinion that the
transactions
described herein are in the best
interests of the parties to this Agreement and their respective interest
holders. This Agreement provides for the
acquisition of JIG by BYMT pursuant to
the merger of Purchaser with JIG. At the effective time of such merger, the
outstanding shares of the capital stock of
JIG shall be converted into the right
to receive shares of the interest of BYMT.
As a result, the
interest holders of
JIG shall become interest holders of BYMT and JIG shall
merge its business and
operations with a wholly owned subsidiary
of BYMT. The transactions described in
this Agreement are subject to the satisfaction of certain other conditions
described in this Agreement. It is the intention of the parties to this
Agreement that the Merger for federal
income tax purposes
shall qualify as a
"reorganization" within the meaning of
Section 368(a) of the Code.
NOW, THEREFORE,
in consideration of the above and the mutual
warranties, representations, covenants, and agreements set forth herein,
the
parties agree as follows:
ARTICLE I
Definitions
In addition to terms defined elsewhere in this Agreement, the
following
terms when used in this Agreement shall
have the meanings indicated below:
"Affiliate" shall mean
with respect to a specified Person, any other
Person which, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common
control with such
Person, and
without limiting the generality of the
foregoing, includes,
with respect to a
Person (a) any other Person which
beneficially
owns or holds ten
percent (10%)
or more of any Series of voting securities
or other securities
convertible into
voting securities of such Person or
beneficially owns or holds ten percent (10%)
or more of any other equity interests in
such Person, (b) any
other Person with
respect to which such Person beneficially owns or holds ten percent (10%) or
more of any Series of voting securities or other securities convertible into
voting securities of such Person, or owns
or holds ten percent (10%) or more of
the equity interests of the other Person,
and (c) any director or senior officer
of such Person. For purposes of this
definition, the term
"control" (including,
with correlative meanings, the terms "controlled by" and
"under common control
with"), as used with respect to any
Person, means the
possession, directly
or
indirectly, of the power to direct or cause
the direction of the management and
policies of such Person, whether through the ownership of
voting securities
or
by contract or otherwise.
<PAGE>
"Agreement" shall mean
this Agreement and Plan of Merger together with
all exhibits and schedules referred to
herein, which exhibits
and schedules are
incorporated herein and made a part
hereof.
"BYMT" shall mean Baymark Technologies, Inc., a Utah
corporation.
"BYMT Interest"
shall mean the shares
of interest,
no par value per
share, of BYMT, as further described in Section 3.11.
"Certificates" shall have the meaning set forth in Section 2.8.
"Closing" shall have the meaning set forth in Section 2.2.
"Closing Date" shall mean the date that the Closing takes
place.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Commission" shall mean the United States Securities and
Exchange
Commission.
"Consideration Shares"
shall have the meaning set forth in Section
2.7(c).
"Effective Time" shall have the meaning set forth in Section
2.3.
"Employee Benefit
Plans" shall have the meaning set forth
in Section
3.18.
"Environmental Laws" shall have the meaning set forth in Section
3.22.
"ERISA" shall have the meaning set forth in Section 3.18.
"Financial Statements
of BYMT" shall mean (i) the unaudited balance
sheet and the unaudited statements of
income, cash flow and retained earnings of
BYMT for the three (3) month period ended
October 31, 2005, and (ii) the audited
balance sheet and the audited statements of income, cash flow and retained
earnings of BYMT for the fiscal year ended
July 31, 2005, including in each such
case any related notes, each prepared according to GAAP consistently applied
with prior periods, except as set forth on
Schedule 3.13.
"GAAP" shall have the meaning set forth in Section 3.13.
"Guaranty" shall mean, as to any Person, all liabilities or
obligations
of such Person, with respect to any indebtedness or other obligations of any
other Person, which have been guaranteed,
directly or
indirectly, in any manner
by such Person, through an agreement,
contingent or
otherwise, to purchase such
indebtedness or obligation, or to purchase or sell property or services,
primarily for the purpose of enabling the debtor to make payment of such
indebtedness or obligation or to guarantee the payment to the owner of
such
indebtedness or obligation against loss, or to supply funds
to or in any manner
invest in the debtor.
<PAGE>
"Indemnified Party" shall have the meaning set forth in Section
5.4.
"Indemnifying Party" shall have the meaning set forth in Section
5.4.
"Intellectual Property" shall mean the rights to any patent,
trademark,
copyright, service mark, invention, software, software code, trade secret,
technology, product, composition, formula,
method or process.
"Investments" shall
mean, with respect to
any Person, all
advances,
loans or extensions of credit to any other Person
(except for
extensions
of
credit to customers in the ordinary course of business), all purchases or
commitments to purchase any stock, bonds,
notes, debentures or
other securities
of any other Person, and any other investment in any other Person, including
partnerships or joint ventures (whether by
capital contribution or otherwise) or
other similar arrangement (whether written
or oral) with any Person, including,
but not limited to, arrangements in which (i) the first Person
shares profits
and losses of the other Person, (ii) any such other Person has the right to
obligate or bind the first Person to any
third party, or (iii)
the first Person
may be wholly or partially liable for the debts or obligations of such
partnership, joint venture or other
entity.
"Knowledge" shall mean, in the case of any Person who is an
individual,
knowledge that a reasonable individual under similar
circumstances
would have
after such investigation and inquiry as such
reasonable individual
would under
such similar circumstances make, and in the case of a Person
other than an
individual, the knowledge that a senior
officer or director of such Person, or
any other Person having responsibility for the particular subject matter at
issue of such Person, would have after such investigation and inquiry as such
senior officer, director or responsible Person would under such similar
circumstances make.
"Law" and
"Laws" shall have the meaning set forth in Section 3.19.
"Liabilities" shall have the meaning set forth in Section 3.14.
"Litigation" shall have the meaning set forth in Section 3.6.
"Material Adverse
Effect" shall mean any event or
condition of any
character which has had or could
reasonably
be expected to have a material
adverse effect on the condition (financial
or otherwise), results of operations,
assets, liabilities, properties, business or prospects of BYMT or JIG, as
applicable.
"Material BYMT Agreements" shall have the meaning set forth
in Section
3.20.
"Merger" shall have the meaning set forth in Section 2.1.
"Merger Consideration"
shall have the meaning set forth in Section
2.7(c).
"Outstanding BYMT
Shares" shall have the
meaning set forth in Section
3.11.
<PAGE>
"Outstanding JIG
Interest" shall have the meaning set forth in Section
4.8.
"Periodic Reports" shall have the meaning set forth in Section
3.13.
"Person" shall mean
any natural person,
corporation,
unincorporated
organization, partnership, association, limited liability
company, joint stock
company, joint venture, trust or government, or any agency or political
subdivision of any government or any other
entity.
"Purchaser" shall mean BT Acquisitions, Inc., a Colorado
corporation
"Purchaser Documents" shall have the meaning set forth in Section
3.2.
"JIG" shall mean JIGJIG, LLC, a Ohio Limited Liability Company.
"JIG Interest" shall have the meaning set forth in Section 4.8.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Subsidiary" of any
Person shall mean any Person, whether or not
capitalized, in which such Person owns, directly or indirectly, an equity
interest of more than fifty percent (50%), or which may effectively be
controlled, directly or indirectly, by such
Person.
"Surviving
Corporation"
shall mean
Purchaser
as the surviving
corporation resulting from the Merger with
Purchaser
"Tax" and "Taxes" shall have the meaning set forth in Section
3.19.
"Tax Returns"
shall have the meaning set forth in Section 3.19.
"Transaction" shall have the meaning set forth in Section 2.1.
The words "hereof",
"herein" and
"hereunder" and the words of similar
import shall refer to this Agreement as a whole and not to any particular
provision of this Agreement. The terms defined in the singular shall have a
comparable meaning when used in the plural
and vice versa.
<PAGE>
ARTICLE II
Transactions; Terms of Merger; Manner of Converting Shares
2.1 Merger. Subject to
the terms and conditions of this Agreement, at
the Effective Time, Purchaser shall merge with JIG in accordance with the
provisions of the Laws of the States of
Colorado and Ohio and with the effect
provided for therein (the "Merger"). As a result of the Merger,
the separate
corporate existence of Purchaser and JIG
shall cease and BT Acquisitions, Inc.
(Purchaser) shall be the Surviving
Corporation
resulting from the Merger and
shall and remain a wholly owned Subsidiary of BYMT and shall continue to be
governed by the laws of the State of Colorado, JIG shall be merged into
Purchaser. The Merger shall be consummated pursuant to the terms of this
Agreement, which has been approved and
adopted by the respective Manager of JIG
and the Boards of Directors of Purchaser and BYMT and, by BYMT,
as the sole
shareholder of Purchaser, and by the interest holders of JIG. After merger
BT
(Purchaser) shall be the sole wholly owned
subsidiary of BYMT.
2.2 Time and Place of Closing. The closing of the transactions
contemplated hereby (the "Closing") will take place at 10:00 A.M. on
the date
that the Effective Time occurs or at such other time as
the parties,
acting
through their authorized officers, may
mutually agree. The Closing shall be held
at the offices of Michael A. Littman, 7609
Ralston Road, Arvada, CO 80002, or at
such other location as may be mutually
agreed upon by the parties. Closing will
occur through exchange of documents by Federal
Express, disbursement of cash
delivery of certificates and filing of a Certificate of Merger in Ohio and
Colorado, with Secretary of State.
2.3 Merger
Effective Time. The Merger contemplated by this Agreement
shall become effective on the date and at the
time the Certificate
of Merger
reflecting the Merger shall become
effective with the
Secretary of State of the
States of Colorado and Ohio (the "Effective Time"). The other transactions
contemplated herein shall be effective
as soon as the
consideration
required
hereby has been delivered.
2.4 Certificate of Merger. The Certificate of Merger or Statement
of
Merger required by Ohio and Colorado Law by
and between BT and JIG
2.5 Charter. The
Certificate of
Incorporation of
Purchaser in effect
immediately prior to the Effective Time shall be the Certificate of
Incorporation of the Surviving Corporation
until duly amended or repealed.
2.6 Bylaws. The Bylaws
of Purchaser in effect immediately prior to the
Effective Time shall be the Bylaws of the Surviving Corporation until duly
amended or repealed.
2.7 Directors and Officers. The managers of JIG in office
immediately
prior to the Effective Time, together with such additional Persons as may
thereafter be elected, shall serve as the officers and directors of the
Surviving Corporation from and after the Effective Time
in accordance with the
Bylaws of the Surviving Corporation.
<PAGE>
2.8 Conversion Shares. Subject to the provisions of this Article
II, at
the Effective Time, by virtue of the Merger and
without any action on the part
of BYMT, JIG or Purchaser or Shareholder or the interest
holders of any of
the
foregoing, the interests and shares of the constituent entities shall be
converted or exchanged as follows:
(a) Each share
of capital stock of BYMT issued and outstanding immediately
prior to the Effective Time shall remain
issued and outstanding
from and after
the Effective Time, however 30,000,000 new shares of
common stock of BYMT shall
be issued to effectuate the transactions
contemplated herein.
(b) All of JIG
interests issued and
outstanding
immediately prior to
the
Effective Time shall be converted
into shares of the
Surviving Corporation
by
virtue of the merger with BT Acquisitions,
Inc. (Purchaser).
(c) BYMT and
Purchaser hereby agree that at the time of
the Merger of JIG
and Purchaser, BYMT shall issue 30,000,000 shares of its common stock in
consideration of the delivery of 100% of
JIG interests to Purchaser.
(d) 100% of
JIG's ownership
interests issued and
outstanding
immediately
prior to the Effective Time shall be exchanged for the right to receive
30,000,000 shares of common stock of BYMT in the aggregate, (the "Exchange
Ratio") (hereinafter such BYMT shares shall
be referred to as the "Consideration
Shares" or the "Merger Consideration"). The Consideration Shares shall, be
issued and delivered at closing, ratably based upon the interest holders
proportionate ownership of JIG prior to the
merger, to the
interest holders of
JIG in accordance with the terms hereof,
and will be fully
paid, validly issued
and non-assessable, but shall not be registered
securities under the Securities
Act of 1933, as amended, (the "Securities Act") pursuant to a valid
exemption
thereunder.
(e) BYMT shall
own, after completion of the transactions contemplated
herein, 100% of the issued and outstanding
shares of surviving corporation. (BT
Acquisitions, Inc. or Purchaser).
2.9 Exchange of
Shares. At the
Closing, the interest
holders of JIG
shall surrender each certificate or certificates which represented JIG's
interest immediately prior to the Effective
Time (the "Certificates") and shall
promptly upon surrender thereof receive in exchange therefore the number of
whole Consideration Shares issuable in respect of all
shares of JIG's interest
held by such JIG interest holder (rounded to the nearest
share) as set forth in
2.7 (d) above. BYMT shall not be obligated
to deliver the consideration to which
a JIG interest holder is entitled as a result of
the Merger until such
Person
surrenders its Certificate or Certificates for exchange as provided in
this
Section 2.8. Any other provision of this
Agreement notwithstanding, neither BYMT
nor the Surviving Corporation shall be liable to an interest
holder of JIG for
any amounts paid or property delivered in good faith to a public official
pursuant to any applicable abandoned
property, escheat or similar law.
<PAGE>
2.10 Rights of Former JIG Interest Holders. At the Effective Time, the
interest transfer books of JIG shall be closed as to
holders of JIG
Interest
immediately prior to the Effective
Time and no transfer
of JIG Interest by any
such holder shall thereafter be made or recognized. Until surrendered for
exchange in accordance with the provisions of Section 2.8, each Certificate
theretofore representing shares of JIG Interest shall from and after the
Effective Time represent for all purposes only the right to receive the
consideration provided in Section 2.7 (d) in exchange therefore. Whenever a
dividend or other distribution is declared
by BYMT on the BYMT stock, the record
date for which is at or after the Effective
Time, the declaration
shall include
dividends or other distributions on all shares of
BYMT stock issuable
pursuant
to this Agreement, but no dividend or other
distribution payable to the holders
of record of BYMT shares as of any time
subsequent to the
Effective Time
shall
be delivered to the holder of any
Certificate until such
holder surrenders such
Certificate for exchange as provided in
Section 2.8. However,
upon surrender of
such Certificate, both the BYMT stock certificate (together with all such
undelivered dividends or other distributions without interest) and any
undelivered dividends payable in respect thereof
(without interest) shall be
delivered and paid with respect to each
share represented by such Certificate.
2.11 Legending of Securities. Each certificate for BYMT shares to be
issued to the JIG interest holders as part of the Merger
Consideration
shall
bear substantially the following
legend:
"THE SHARES
REPRESENTED BY THIS
CERTIFICATE HAVE NOT
BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, OR ANY STATE
SECURITIES
LAWS. THESE SHARES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED. OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER SAID ACT OR LAWS, OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT, IN THE CIRCUMSTANCES,
REQUIRED UNDER SAID ACT".
2.12 Fractional
Shares. Notwithstanding any other provision of this
Agreement, if the Sellers would otherwise have been entitled to receive a
fraction of a share of BYMT shares (after
taking into account
all certificates
delivered by the JIG interest holders), the
number of shares issuable to the JIG
interest holder shall be rounded up to the
next whole number.
2.13 Lost,
Stolen or Destroyed Certificates. In the event that any
Certificates shall have been lost, stolen or destroyed, upon the making of an
affidavit of that fact by such JIG interest
holder (setting forth the interest
JIG Interest represented by such lost,
stolen or destroyed
Certificates),
BYMT
shall issue to such JIG interest holder the
Consideration
Shares to which
such
JIG interest holder is entitled.
<PAGE>
ARTICLE III
Representations and Warranties of BYMT, and Purchaser
In order to induce JIG to enter into this Agreement and to consummate
the transactions contemplated hereby, BYMT, Purchaser (as
defined in Article I
above), jointly and severally, make the
representations and warranties set forth
below to JIG.
3.1 Organization;
Standing and Power. BYMT is a corporation duly
organized, validly existing and in good
standing under the laws of the State of
Utah. Purchaser is a corporation
duly organized,
validly existing and
in good
standing under the laws of the State of
Colorado. BYMT and
Purchaser have all
requisite right, power and authority to execute, deliver and perform this
Agreement and to consummate the transactions contemplated hereby. BYMT and
Purchaser have all corporate right, power and authority to own or lease and
operate their assets, and to conduct their
business as presently conducted. BYMT
and Purchaser are duly qualified to
transact business as a
foreign
corporation
in all jurisdictions where the ownership or leasing of
their properties or the
conduct of its business requires such
qualification.
3.2 Authorization;
Enforceability.
The execution, delivery and
performance of this Agreement by BYMT and
Purchaser and all other agreements to
be executed, delivered and performed by BYMT and Purchaser pursuant to this
Agreement (collectively, the "Purchaser Documents") and the consummation by
BYMT, Purchaser of the transactions
contemplated
hereby and thereby
have been
duly authorized by all requisite
corporate or
individual action on
the part of
BYMT and Purchaser as applicable. This Agreement and the Purchaser
Documents
have been duly executed and delivered by
BYMT and Purchaser and
constitute the
legal, valid and binding obligation of BYMT and Purchaser enforceable in
accordance with their respective terms, except to the extent that their
enforcement is limited by bankruptcy,
insolvency,
reorganization or
other laws
relating to or affecting the enforcement of
creditors' rights
generally and by
general principles of equity.
3.3 No Violation or Conflict. The execution, delivery and performance
of this Agreement and the Purchaser
Documents by BYMT and
Purchaser,
and the
consummation by BYMT, and Purchaser of the
transactions
contemplated hereby and
thereby: (a) do not violate or conflict
with any provision of law or regulation
(whether federal, state or local), or any writ,
order or decree of any court or
governmental or regulatory authority, or any provision of BYMT or
Purchaser's
Articles or Certificate of Incorporation or
Bylaws; and (b) do not and will not,
with or without the passage of time or the giving of notice, result in the
breach of, or constitute a default (or an event that with
notice or lapse of
time or both would become a default),
cause the acceleration of performance,
give to others any right of termination,
amendment, acceleration or cancellation
of or require any consent under,
or result in the
creation of any lien,
charge
or encumbrance upon any property or assets
of BYMT or Purchaser
pursuant to any
instrument or agreement to which BYMT or
Purchaser is a party or by which BYMT
or Purchaser or their respective properties
may be bound or affected.
<PAGE>
3.4 Consents
of Governmental Authorities and Others. No consent,
approval, order or authorization of, or
registration, declaration, qualification
or filing with any federal, state or local
governmental or regulatory authority,
or any other Person, is required to be made
by BYMT, and Purchaser in connection
with the execution, delivery or performance of this Agreement by BYMT, and
Purchaser or the consummation by BYMT, and of the transactions contemplated
hereby.
3.5 Conduct of
Business. Except as
disclosed on Schedule
3.5 hereto,
since July 31, 2005, BYMT has conducted no
active businesses in the ordinary and
usual course consistent with past practices and there has not occurred any
adverse change in the condition (financial
or otherwise), results of operations,
properties, assets, liabilities, business or prospects of BYMT, and no such
change is threatened. Without limiting the generality of the
foregoing, since
July 31, 2005, except as provided in this
Agreement, BYMT has
not: (a) amended
its Articles of Incorporation or Bylaws except as to a reverse
split of its
issued and outstanding common shares of one for 10,
however shareholders
have
authorized of a name change and Series A
Preferred shareholders
have authorized
an Amendment to the Designation of Rights and Privileges of Series
A Preferred
Stock to provide a conversion privilege of 16 shares of common stock for
each
one share of Series A Preferred Stock
outstanding and other amendments pertinent
thereto; (b) issued, sold or authorized for issuance or sale, shares of any
Series of its securities (including, but not limited to, by way of
stock split
or dividend) or any subscriptions, options, warrants, rights or convertible
securities or entered into any agreements or commitments of any character
obligating it to issue or sell any such
securities; (c)
redeemed, purchased
or
otherwise acquired, directly or indirectly,
any shares of its
capital stock or
any option, warrant or other right to purchase or acquire any such capital
stock; (d) suffered any damage,
destruction or loss,
whether or not covered
by
insurance, which has had or could
reasonably
be expected to have a Material
Adverse Effect on any of its properties, assets, business or prospects;
(e)
granted or made any mortgage or pledge or subjected itself or any of its
properties or assets to any lien, charge or
encumbrance of any kind; (f) made or
committed to make any capital expenditures in excess of $10,000; (g) become
subject to any Guaranty; (h) granted any
increase in the compensation payable or
to become payable to directors, officers or employees (including, without
limitation, any such increase pursuant to
any severance package, bonus, pension,
profit-sharing or other plan or commitment); (i) entered into any agreement
which would be a Material Agreement, or amended or terminated any existing
Material Agreement; (j) been named as a party in any
Litigation, or become
the
focus of any investigation by any government or
regulatory agency or authority;
(k) declared or paid any dividend or other distribution with respect to its
capital stock; or (l) experienced any other event
or condition of any character
which has had or to BYMT's could reasonably be expected to have a Material
Adverse Effect on BYMT.
3.6 Litigation. There are no actions, suits, investigations,
claims or
proceedings ("Litigation") pending or, to the Knowledge of
BYMT, and Purchaser
threatened before any court or by or before
any governmental or regulatory
authority or arbitrator, (a) affecting BYMT or Purchaser (as plaintiff or
defendant) or (b) against BYMT, and
Purchaser relating to BYMT's Interest or the
transactions contemplated by this Agreement and there exist no facts or
circumstances to the Knowledge of BYMT,
and Purchaser
creating any
reasonable
basis for the institution of any Litigation
against BYMT, and Purchaser.
<PAGE>
3.7 Brokers. Neither BYMT or JIG, and Purchaser has employed any
broker
or finder, and none of them has incurred or
will incur, directly
or indirectly,
any broker's, finder's, investment banking or similar fees,
commissions
or
expenses in connection with the
transactions
contemplated by this
Agreement or
the Purchaser Documents.
3.8 Compliance. BYMT
and Purchaser are in compliance with all federal,
state, local and foreign laws,
ordinances,
regulations,
judgments,
rulings,
orders and other requirements applicable to BYMT and Purchaser and their
respective assets and properties,
including, without
limitation, those relating
to (a) the registration and sale of the
BYMT Interest, (b) the
establishment of
a public trading market for the BYMT
Interest, and (c) the public trading of the
BYMT Interest. BYMT and Purchaser are not
subject to any judicial, governmental
or administrative inquiry, investigation,
order, judgment or decree.
3.9 Charter, Bylaws and Corporate Records. A true, correct and
complete
copy of (a) the Articles of Incorporation
of BYMT and Purchaser,
as amended and
in effect on the date hereof, (b) the Bylaws of BYMT and
Purchaser, as
amended
and in effect on the date hereof, and (c)
the minute books of BYMT and Purchaser
(containing all corporate proceedings from the date of
incorporation) have been
furnished to JIG. Such minute books contain
accurate records of all meetings and
other corporate actions of the board of directors,
committees of the
board of
directors, incorporators and shareholders
of BYMT and Purchaser from the date of
its incorporation to the date hereof which were
memorialized
in writing.
No
actions have been taken since the date of
BYMT or Purchaser's incorporation that
are not memorialized in writing.
3.10 Subsidiaries and
Investments. BYMT has
only one Subsidiaries or
Investments. BYMT owns one hundred percent
(100%) of the issued and outstanding
capital stock of the Subsidiary BT
Acquisitions, Inc..
3.11 Capitalization.
The authorized capital
stock of BYMT consists of
150,000,000 shares of stock, of which 661,572
shares are issued and outstanding
(the "Outstanding BYMT Shares") and
1,000,000 shares of Series A Preferred Stock
are authorized, issued and outstanding which are convertible to units as
set
forth in the Designation of Preferences as amended.
All shares of
Outstanding
BYMT common and Series A stock have been
duly authorized, are validly issued and
outstanding, and are fully paid and
non-assessable. No securities issued by BYMT
from the date of its incorporation to the date hereof were issued in
violation
of any statutory, contractual or common law
preemptive
rights. There are no
dividends which have accrued or been declared but are unpaid on the capital
stock of BYMT. All taxes required to be
paid in connection with the issuance and
any transfers of BYMT's capital stock have been paid. All permits or
authorizations required to be obtained from or registrations required to be
effected with any Person in connection with any and all common and Series A
Preferred issuances of securities of BYMT
from the date of BYMT's incorporation
to the date hereof have been obtained or effected and all securities of BYMT
have been issued and are held in accordance with the provisions of all
applicable securities or other laws. Series B
Preferred Stock as carried on the
books is being cancelled since it was
conditionally issued for consideration for
a casino license never approved by Nevada
Gaming Commission.
The Consideration
Shares shall, upon issuance and delivery to the JIG interest holders in
accordance with the terms hereof, be fully paid, validly issued and
non-assessable, but shall not be registered
securities under the Securities Act
of 1933. There are no registration rights outstanding which relate to the
Outstanding BYMT shares and, to the Knowledge of BYMT, there are no voting
trusts, proxies or other agreements or
understandings with respect to any equity
security of any Series of BYMT or with respect to any equity security,
partnership interest or similar ownership
interest of any Series
of any of its
Subsidiaries, except as provided herein or in the Amendment to the
Designation
of Preferences Rights and Privileges of
Series A Preferred Stock.
<PAGE>
3.12 Rights, Warrants, Options. There are no outstanding (a)
securities
or instruments convertible into or exercisable for any of the
capital stock or
other equity interests of BYMT or Purchaser
except that Series A Preferred Stock
is convertible to units consisting of
common shares and warrants as set forth in
the Designation of Preferences of Series A. (b) options, warrants,
subscriptions, puts, calls, or other rights to acquire capital
stock or other
equity interests of BYMT or Purchaser; or (c) commitments, agreements or
understandings of any kind, including
employee benefit arrangements, relating to
the issuance or repurchase by BYMT or Purchaser of any
capital stock or
other
equity interests of BYMT or Purchaser, or any instruments convertible or
exercisable for any such securities or any options, warrants or rights to
acquire such securities.
3.13 Commission Filings and Financial Statements. All of the Periodic
Reports of BYMT required to satisfy the
information
requirements of
Section 13
of the Exchange Act have been filed with the
Commission,
and have been
true,
accurate and complete in all material
respects and have been filed in compliance
with the requirements of the Exchange Act.
The Financial Statements of BYMT: (a)
have been prepared in accordance
with the books of
account and records of BYMT;
(b) fairly present, and are true, correct and complete statements in all
material respects of BYMT's financial condition and the results of its
operations at the dates and for the periods
specified in those
statements; and
(c) have been prepared in accordance with United States generally accepted
accounting principles ("GAAP") consistently
applied with prior per
