AGREEMENT AND PLAN OF REORGANIZATION
BY AND BETWEEN
LIFE USA, INC.,
NEURO NUTRITION, INC.,
and
THE SHAREHOLDERS OF NEURO NUTRITION, INC .
August __, 2005
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions......................
.............................1
ARTICLE II Transactions; Terms of
Transaction; Manner of Converting Share...5
2.1
Transaction.................................................5
2.2
Time and Place
of Closing...................................5
2.3 Effective
Time..............................................5
2.4
Charter.....................................................5
2.5
Bylaws......................................................5
2.6 Directors
and Officers......................................5
2.7 Conversion
of Shares........................................5
2.8 Exchange
of Shares..........................................6
2.9 Rights of
Former Neuro Stockholders.........................6
2.10
Legending of Shares.........................................7
2.11
Fractional Shares...........................................7
2.12
Lost, Stolen or Destroyed Certificates......................7
ARTICLE III
Representations and Warranties of LUSA, PURCHASER and THE LUSA
........................7
3.1
Organization; Standing and Power............................7
3.2
Authorization; Enforceability...............................8
3.3 No
Violation or Conflict....................................8
3.4 Consents
of Governmental Authorities and Others.............8
3.5 Conduct of
Business.........................................9
3.6
Litigation..................................................9
3.7
Brokers.....................................................9
3.8
Compliance.................................................10
3.9 Charter,
Bylaws and Corporate Records......................10
3.10
Subsidiaries and Investments...............................10
3.11
Capitalization.............................................10
3.12
Rights, Warrants, Options..................................11
<PAGE>
3.13
Commission Filings and Financial Statements................11
3.14
Absence of Undisclosed Liabilities.........................11
3.15
Real Property..............................................11
3.16
List of Accounts and Proxies...............................12
3.17
Personnel..................................................12
3.18
Employment Agreements and Employee Benefit Plans...........12
3.19
Tax Matters................................................13
3.20
Material Agreements........................................13
3.21
Guaranties.................................................14
3.22
Environmental Matters......................................14
3.23
Absence of Certain Business Practices......................14
3.24
Disclosure.................................................15
ARTICLE IV
Representations and Warranties of Neuro................15
4.1
Organization...............................................15
4.2
Authorization; Enforceability..............................15
4.3 No
Violation or Conflict...................................16
4.4 Consents
of Governmental Authorities and Others............16
4.5
Brokers....................................................16
4.6 Charter,
Bylaws and Corporate Records......................16
4.7
Subsidiaries and Investments...............................16
4.8
Capitalization.............................................16
4.9 Rights,
Warrants, Options..................................17
ARTICLE V
Additional Agreements..................................17
5.1 Survival
of the Representations and Warranties.............17
5.2
Investigation..............................................17
5.3
Indemnification............................................17
5.4 Indemnity
Procedure........................................18
5.5 General
Release............................................19
<PAGE>
ARTICLE VI
Closing; Deliveries; Conditions Precedent..............19
6.1 Closing;
Effective Date....................................19
6.2
Deliveries.................................................20
6.3 Conditions
Precedent to the Obligations of Neuro...........21
6.4 Conditions
Precedent to the Obligations of LUSA............23
6.5 Best
Efforts...............................................23
6.6
Termination................................................23
ARTICLE VII
Covenants..............................................24
7.1 General
Confidentiality....................................24
7.2 Continuing
Obligations.....................................25
7.3
Satisfaction of Certain Outstanding Payables...............25
7.4 Tax
Matters................................................25
ARTICLE VIII
Miscellaneous..........................................25
8.1
Notices....................................................25
8.2 Entire
Agreement; Incorporation............................26
8.3 Binding
Effect.............................................27
8.4
Assignment.................................................27
8.5 Waiver and
Amendment.......................................27
8.6 No Third
Party Beneficiary.................................27
8.7
Severability...............................................27
8.8
Expenses...................................................27
8.9
Headings...................................................28
8.10
Other Remedies; Injunctive Relief..........................28
8.11
Counterparts...............................................28
8.12
Remedies Exclusive.........................................28
8.13
Jurisdiction and Venue.....................................28
8.14
Participation of Parties...................................28
8.15
Further Assurances.........................................29
8.16
Publicity..................................................29
<PAGE>
AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF
REORGANIZATION (the
"Agreement"),
dated as of
August __, 2005, by and among Neuro Nutrition, Inc., a Colorado Corporation
("Neuro"); and LIFE USA, INC., a Colorado
Corporation ("LUSA");
(as defined in
Article I) and the Neuro shareholders
("Shareholders").
W I T N E S S E T H:
Preamble
The respective Boards of Directors of Neuro Nutrition, and LUSA are of
the opinion that the transactions
described herein are
in the best interests of
the parties to this Agreement and their
respective stockholders. This Agreement
provides for the acquisition of Neuro by
LUSA as a wholly owned
subsidiary. At
the effective time of the transaction, the outstanding shares of the capital
stock of Neuro shall be exchanged
for shares of the
common stock of LUSA.
As a
result, the stockholders of Neuro shall become
stockholders of LUSA
and Neuro
shall continue to conduct its business and operations as a wholly owned
subsidiary of LUSA. 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
transaction 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 class 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 class 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 Reorganization
together with all exhibits and schedules
referred to herein,
which exhibits and
schedules are incorporated herein and made
a part hereof.
"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.
"Exchange Ratio" shall have the meaning set forth in Section
2.7(c).
"Financial Statements of LUSA" shall mean (i) the audited balance
sheet
and the audited statements of income, cash flow and retained
earnings of LUSA
for the twelve (12) month period ended
December 31, 2004, and (ii) the unaudited
balance sheet and the unaudited
statements
of income,
cash flow and
retained
earnings of LUSA for the fiscal year ended
July 31, 2004, 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 LUSA or Neuro, as
applicable.
"Material LUSA Agreements" shall have the meaning set forth
in Section
3.20.
"Transaction" shall have the meaning set forth in Section 2.1.
"Transaction Consideration" shall have the meaning set forth in
Section
2.7(c).
<PAGE>
"Outstanding LUSA
Common Stock" shall have the meaning set forth
in
Section 3.11.
"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.
Shareholder or "Newuro
Shareholders" shall mean Shareholders of Neuro
Nutrition, Inc.,
a Colorado corporation
"Neuro" shall mean Neuro Nutrition, Inc., a Colorado
Corporation.
"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.
"Parent Corporation"
shall mean Neuro as the surviving corporation
resulting from the Transaction 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.
"LUSA" shall mean Life USA, Inc., a Colorado corporation.
----
"LUSA Common Stock" shall mean the shares of common stock, no par
value
per share, of LUSA, as further described in
Section 3.11.
"LUSA Leased
Property" shall have the meaning set forth in Section
3.15.
"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 Transaction; Manner of Exchanging Shares
2.1 Transaction.
Subject to the terms
and conditions of this Agreement, at
the Effective Time, 100% of outstanding
stock of Neuro shall be acquired by LUSA
in accordance with the provisions of the Laws of the State of
Colorado. As a
result of the Transaction, Neuro shall become a wholly owned
Subsidiary of LUSA
and shall continue to be governed by the laws of the State of
Colorado. The
Transaction shall be consummated pursuant
to the terms of this Agreement, which
has been approved and adopted by the
respective
Boards of Directors of
Neuro,
and LUSA, and by the joinder hereof by
Shareholders of Neuro Nutrition, Inc..
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.
2.3 Effective
Time. The transactions
contemplated by this
Agreement shall
become effective on the date and at the
time this document has been executed by
all parties.(the "Effective Time").
2.4 Charter. The Certificate of Incorporation of Neuro in effect
immediately prior to the Effective Time shall be the Certificate of
Incorporation of the Parent corporation
until duly amended or repealed.
2.5 Bylaws. The Bylaws of Neuro in effect immediately prior to the
Effective Time shall be the Bylaws of the
Parent Corporation
until duly amended
or repealed.
2.6 Directors
and Officers.
The directors of Neuro
in office
immediately
prior to the Effective Time, together with such two additional
Persons as Neuro
may desire to appoint, shall serve as the directors of the Parent
Corporation
from and after the Effective Time in accordance with the Bylaws of LUSA.
The
officers of Neuro in office immediately prior to the Effective Time,
together
with such additional Persons as may
thereafter be elected, shall be appointed by
the Board to serve as the officers of LUSA
from and after the Effective Time in
accordance with the Bylaws of the LUSA.
2.7 Exchange of
Shares. Subject to the
provisions
of this Article II,
at
the Effective Time, by virtue of this
Agreement and without
any further action
on the part of LUSA, Neuro or the stockholders of any of the foregoing, the
shares of LUSA shall be exchanged as
follows:
Each share of Neuro
Shareholders Common
Stock issued and
outstanding
immediately prior to the Effective Time shall be exchanged
into one share of
Common Stock of the Parent Corporation, LUSA, the Consideration
Shares shall,
upon issuance and delivery to the
stockholders
of Neuro 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, as amended, (the
"Securities Act") pursuant to a valid
exemption thereunder.
<PAGE>
2.8 Exchange of Shares. At the Closing, the Neuro Shareholders shall
surrender each certificate or certificates
which represented
shares of Neuro's
Common Stock 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 Neuro's
Common Stock held by such Neuro Shareholder
(rounded to the nearest share). LUSA
shall not be obligated to deliver the
consideration to which a Neuro Shareholder
is entitled as a result of the Transaction until such Person surrenders its
Certificate or Certificates for exchange as provided in this
Section 2.8. Any
other provision of this Agreement
notwithstanding, LUSA shall not be liable to a
holder of Neuro's Common Stock for any amounts paid or property delivered in
good faith to a public official pursuant to
any applicable
abandoned
property,
escheat or similar law.
2.9 Rights of Former Neuro Shareholders. At the Effective Time, the
stock transfer books of Neuro shall be closed as to holders
of Neuro Common
Stock immediately prior to the Effective
Time and no transfer
of Neuro Common
Stock 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 Neuro Common Stock shall from and
after the Effective Time represent for all purposes only
the right to receive
the consideration provided in Section 2.7 in
exchange therefore. Whenever a
dividend or other distribution is declared
by LUSA on the LUSA Common 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 LUSA Common
Stock
issuable pursuant to this Agreement, but no dividend or other distribution
payable to the holders of record of LUSA
Common Stock 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 LUSA Common 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.
2.10 Legending of Securities. Each certificate for LUSA Common
Stock to
be issued to the Neuro Shareholders as part of the Transaction 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".
<PAGE>
2.11 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 LUSA Common Stock (after taking into account all
certificates delivered by the Neuro
stockholders), the number of shares issuable
to the Neuro stockholder shall be rounded
up to the next whole number.
2.12 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 Neuro
stockholder
(setting forth the number of
shares of Neuro Common Stock represented by such lost, stolen or destroyed
Certificates), LUSA shall issue such Neuro
Shareholder the Consideration Shares
to which such Neuro Shareholder is
entitled.
ARTICLE III
Representations and Warranties of LUSA
In order to induce Neuro and Stockholders to enter into this
Agreement
and to consummate the transactions contemplated hereby, LUSA makes the
representations and warranties set forth
below to Neuro and Stockholders.
3.1 Organization;
Standing and Power. LUSA is a corporation duly
organized, validly existing and in good
standing under the laws of the State of
Colorado. Purchaser is a corporation
duly organized,
validly existing and in
good standing under the laws of the State of
Colorado. LUSA has all
requisite
right, power and authority to execute,
deliver and perform this Agreement and to
consummate the transactions contemplated hereby. LUSA has all corporate
right,
power and authority to own or lease and
operate their properties, and to conduct
their business as presently conducted. LUSA is 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 LUSA, and
all other agreements
to be executed,
delivered and performed by LUSA pursuant to
this Agreement
(collectively,
the
"Purchaser Documents") and the consummation by LUSA of the transactions
contemplated hereby and thereby have been duly authorized by all requisite
corporate or individual action on the part
of LUSA as applicable. This Agreement
have been duly executed and delivered by
LUSA, and constitute
the legal, valid
and binding obligation of LUSA,
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.
<PAGE>
3.3 No Violation or Conflict. The execution, delivery and performance
of this Agreement by LUSA, Shareholders and Neuro and the
consummation by LUSA,
Shareholders and Neuro 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 LUSA 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 LUSA
pursuant to any
instrument or
agreement to
which LUSA is a party or by which
LUSA or their
respective
properties
may be
bound or affected, other than instruments or agreements as to which consent
shall have been obtained at or prior to the
Closing, each of which
instruments
or agreements is listed in Schedule 3.3
hereto.
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 LUSA in connection with the
execution, delivery or performance of this Agreement by LUSA, or the
consummation by LUSA of the transactions
contemplated hereby.
3.5 Conduct of
Business. Except as
disclosed on Schedule
3.5 hereto,
since December 31, 2004, LUSA has conducted its 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 LUSA, and no such
change is threatened. Without limiting the generality of
the foregoing,
except
as disclosed on Schedule 3.6, since
December 31, 2004, LUSA has not: (a) amended
its Articles of Incorporation or Bylaws except as
to a reverse split of one for
50 and authorization of a name change ; (b)
issued, sold or authorized for
issuance or sale, shares of any class 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 LUSA's Knowledge, could
reasonably be expected to have a Material
Adverse Effect on LUSA.
<PAGE>
3.6 Litigation.
There are no actions, suits, investigations, claims or
proceedings ("Litigation") pending or, to the Knowledge of LUSA, threatened
before any court or by or before any
governmental
or regulatory authority or
arbitrator, (a) affecting LUSA (as plaintiff or defendant)
or (b) against LUSA
relating to LUSA's Common Stock or the transactions contemplated by this
Agreement and there exist no facts or
circumstances
to the Knowledge of LUSA
creating any reasonable basis for the institution of any Litigation against
LUSA.
3.7 Brokers.
Neither of LUSA,
nor Neuro 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.
3.8 Compliance. LUSA
is in compliance with all federal, state, local
and foreign laws, ordinances, regulations, judgments, rulings,
orders and other
requirements applicable to LUSA and its respective assets and properties,
including, without limitation, those relating to the registration
and sale of
the LUSA Common Stock. LUSA is 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 LUSA as amended and in effect
on
the date hereof, (b) the Bylaws of LUSA,
as amended and in
effect on the date
hereof, and (c) the minute books of LUSA
(containing all corporate proceedings
from the date of incorporation)
have been furnished to
Neuro. 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 LUSA from the date of its
incorporation to the date hereof which
were memorialized in writing. No actions have been taken since
the date of LUSA
incorporation that are not memorialized in
writing.
3.10
Subsidiaries and. LUSA
has no Subsidiaries.
3.11 Capitalization.
The authorized capital
stock of LUSA consists of
50,000,000 shares of common stock, of which 786,265 shares are issued and
outstanding (the "Outstanding LUSA Common Stock"). All shares of Outstanding
LUSA Common Stock have been duly
authorized, are validly issued and outstanding,
and are fully paid and non-assessable. No securities issued by LUSA 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 LUSA.
All taxes required to be paid in connection
with the issuance and
any transfers
of LUSA'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 issuances of securities of LUSA from the date of
LUSA's incorporation to the date hereof have been
obtained or effected and all
securities of LUSA have been issued and are held in accordance with the
provisions of all applicable securities or other laws.
The Outstanding LUSA
Common Stock constitutes one hundred percent (100%) of the issued and
outstanding capital stock of LUSA. The
Consideration Shares shall, upon issuance
and delivery to the Neuro stockholders 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 LUSA Common Stock and, to the
Knowledge of LUSA, there are no voting trusts,
proxies or other
agreements or
understandings with respect to any equity
security of any class of LUSA.
<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 LUSA; (b) options, warrants, subscriptions, puts,
calls, or other rights to acquire
capital stock or other equity interests of
LUSA; or (c) commitments, agreements or understandings
of any kind,
including
employee benefit arrangements, relating to
the issuance or repurchase by LUSA of
any capital stock or other equity interests of LUSA, 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 LUSA required to satisfy the
information
requirements of
Section 13
of the Exchange Act have been filed with the Commission, 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 LUSA: (a)
have been prepared in accordance
with the books of
account and records of LUSA;
(b) fairly present, and are true, correct and complete statements in all
material respects of LUSA'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 periods.
3.14 Absence of Undisclosed Liabilities. Other than as disclosed by
the
Periodic Reports, the Financial Statements of LUSA or as disclosed
on Schedule
3.14, LUSA do not have any direct or
indirect indebtedness,
liability,
claim,
loss, damage, deficiency, obligation or
responsibility, known
or unknown, fixed
or unfixed, choate or inchoate, liquidated or unliquidated, secured or
unsecured, accrued, absolute, contingent or otherwise, including, without
limitation, liabilities on account of taxes, other governmental charges or
Litigation, whether or not of a kind required by GAAP to be set forth on a
financial statement ("Liabilities"). Except
as listed on Schedule 3.14, LUSA and
Purchaser do not have any Liabilities other than Liabilities fully and
adequately reflected in the Periodic
Reports or the
Financial Statements of
LUSA. LUSA has no Knowledge of any circumstances, conditions, events or
arrangements which may hereafter give rise
to any Liabilities of LUSA, except as
set forth on Schedule 3.14.
3.15 Real
Property and Mineral Leases. LUSA do not own any fee
simple
interest in real property. Nor has it any
mineral leases.
3.16 List of Accounts and Proxies. Set forth on Schedule 3.16 is: (a)
the name and address of each bank or other
institution
in which LUSA
maintains
an account (cash, securities or other) or safe deposit box; (b) the name and
phone number of LUSA's contact person at such bank or institution; (c) the
account number of the relevant account and
a description of the type of account;
(d) the name of each person authorized by
LUSA to effect transactions therewith
or to have access to any safe deposit box
or vault; and (e) all proxies, powers
of attorney or other like instruments to act on behalf of LUSA in matters
concerning its business or affairs.
<PAGE>
3.17 Personnel.
Schedule 3.17 contains the names and annual
salary
rates and other compensation of all officers, directors, consultants and
employees of LUSA (including compensation paid or payable by LUSA under any
employee benefit or option plans). There are no employee pol
